On January 1 2006 Von Company entered into two noncancelableleases for new machi

On January 1 2006 Von Company entered into two noncancelableleases for new machines to be used in its manufacturing operations.The first lease does not contain a bargain purchase option; thelease term is equal to 80 percent of the estimated economic life ofthe machine. The second lease contains a bargain purchase option;the lease term is equal to 50 percent of the estimated economiclife of the machine.