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Technoid Inc. sells computer systems. computers was $12 million. Technoid leases computers to Lone Star Company on January 1, 2018. The manufacturing cost of the

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Technoid Inc. sells computer systems. computers was $12 million. Technoid leases computers to Lone Star Company on January 1, 2018. The manufacturing cost of the This noncancelable lease had the following terms Lease payments: $2.466.754 semiannually, first payment at January 1,2018, remaining payments at June 30 through June 30, 2022 Lease term: five years (10 semiannual payments) No residual value, no purchase option. Economic life of equipment five years Implicit interest rate and lessee's incremental borrowing rate 5% semiannually Fair value of the computers at January 1, 2018: $20 million $2.466.754 semiannualy, first payment at January 1 1.2018, remaining payments at June 30 and December 31 each year r Technold would account for this as: A sales-type lease without selling profit. An operating lease. A finance lease. A sales-type lease with selling profit

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