On May 1, 2017, Charles Corp.leased equipment to Darwin Inc.for one year under an operating lease.Instead of leasing it, Darwin could have bought the equipment from Charles for $800,000 cash.At this time, Charles's accounting records showed a book value for the equipment of $700,000.Depreciation on the equipment in 2017 was $90,000.During 2017, Darwin paid $22,500 per month rent to Charles for the 8-month period, and Charles incurred maintenance and other related costs under the terms of the lease of $16,000.
The pre-tax expense reported by Darwin from this lease for the year ended December 31, 2017, should be
A)$74,000.
B)$90,000.
C)$164,000.
D)$180,000.

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The Answer of On May 1, 2017, Charles Corp.leased equipment to Darwin Inc.for one year under an operating lease.Instead of leasing it, Darwin could have bought the equipment from Charles for $800,000 cash.At this time, Charles's accounting records showed a book value for the equipment of $700,000.Depreciation on the equipment in 2017 was $90,000.During 2017, Darwin paid $22,500 per month rent to Charles for the 8-month period, and Charles incurred maintenance and other related costs under the terms of the lease of $16,000.
The pre-tax expense reported by Darwin from this lease for the year ended December 31, 2017, should be
A)$74,000.
B)$90,000.
C)$164,000.
D)$180,000.