[salmankhan6721]

I needed some help in this question

determine the type of lease?

cash payment of asset--$500,000

fair value--$653,681

lease term ---3 years
semi annual rental payments - $123,000 at the beginning of each period
economic life of the asset- 4 years
implicit interest rate--12%
unguranteed residual value--$40,000
regulatory fees paid by lessor---$3,000 twice each year
lessors initial direct costs--$4,500
contingent rental payments---$4,000 if revenues exceed a specified base

end of question

[Just Looking]

Please see the following announcement.

Announcement:

Look at the rules for determining if this is a capital lease. If it doesn't fit any of them, it is an operating lease. If you want to show your analysis and result, we can check it to make sure you understand. Thanks.