Trussel Creations Leased Kitchen Equipment Under a Five-Year Lease with an Option

Trussel Creations leased kitchen equipment under a five-year lease with an option to renew for three years at the end of five years and an option to renew for an additional three years at the end of eight years. The first three-year renewal option can be exercised for one-half the original and usual rate. What is the length of the lease term that Trussel Creations should assume in recording the transactions related to the lease?

A) 5 years
B) 8 years
C) 11 years
D) cannot be determined

Correct Answer:

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