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Support My Subson Lessee Inc. is considering the following two separate lesses. Each lease pertains to the lease of equipment with a fair value of

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Support My Subson Lessee Inc. is considering the following two separate lesses. Each lease pertains to the lease of equipment with a fair value of $100,000 Lease One Lease Two Ownership of Na NO NO vel equipment transfers to lessee se ord Lease include purchase option Length of Jease term Economic te of gulme Alternative ute of the opment 5 7 Meuse end tes AN payment Dayment th . 11 Cuan wa Lessee Ine's incremental borrowing rate is 7% and Lessen is not aware of the implicit rate of either lease. For texter One, the lesste estimates an expected far value of only $12,000 of the equipment at lease-end based on its expected usage. For Lease Two, although the fair value of the equipment expected to be greater than the purchase option, Lessee in notranby assured that it will take advantage of the option based on its forecast of available cash at that time How would Lessere in classify Lease One and Lease Two? Select one a Lease One Finance lease b Lease One Finance lease Lease Two Operatings Lease two Finance lease Lease. Two Finance lease Lease One Operating d. Lease One Operating lease Lease two Operating lease

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