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Marin Leasing Company signs a lease agreement on January 1, 2017, to lease electronic equipment...

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Accounting

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Marin Leasing Company signs a lease agreement on January 1, 2017, to lease electronic equipment to Cullumber Company. The term of the non-cancelable lease is 2 years, and payments are required at the end of each year. The following information relates to this agreement: 1. Cullumber has the option to purchase the equipment for $16,000 upon termination of the lease. It is not reasonably certain that Cullumber will exercise this option. 2. The equipment has a cost of $120,000 and fair value of $163,000 to Marin Leasing. The useful economic life is 2 years, with a residual value of $16,000 3. Marin Leasing desires to earn a return of 5% on its investment Collectibility of the payments by Marin Leasing is probable

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