F5

Front 1

OWNS
must meets one of four

Back 1

Ownership transfers at the end of lease (upon final payment or required buyout).
Written option for bargain purchase.
70% or more of asset economic life is being committed in lease term.
Ninety (90%) percent of leased property FV <=PV of lease payment.

Front 2

OWESFACS

Back 2

The lease transfers ownership of the asset to the lessee by the end of the lease term.
the lease contains a written bargain purchase option.
The lease term is for the major part of the economic life of the asset een if title is not transferred.
The present value of the minimum lease paymets amounts to at least substantially all of the fair value of the leased asset.
Gains and losses form the fluctuation in the fair value of the residual accrue to the lessee.
The lessee has the ability to continue the lease for a secondary period at a rent that is substantially lower than market rent.
The lessee can cancel the lease and lessor's losses associated with the cancelation are borne by the lessee.
The leased assets are of such a specialized nature that only the lessee can use them without modification.

Front 3

LUC
must meets all three

Back 3

Lessee "owns" the leased property (meets any one of OWNS).
Uncertainties do not exist regarding any unreimbusable costs to be incurred by the lessor.
Collectability of the lease payments is reasonably. predictable.