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Farm Co. leased equipment to Union Co. on July 1, 2015, and properly recorded the...

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Accounting

Farm Co. leased equipment to Union Co. on July 1, 2015, and properly recorded the sales-type lease at $78,185, the present value of the lease payments discounted at 6%. The first of five annual lease payments of $15,000 due at the beginning of each year of the lease term was received and recorded on July 3, 2015. Farm had purchased the equipment for $77,081. What amount of revenue or income from the lease should Farm report in its 2015 income statement?

a) $3,000

b) $2,500

c) $2,000

d) $0

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