On December 31, 2013, our company signed the lease for some equipment having 8-year useful life. The lease payments are made annually, beginning at the signing date. Title doesn't transfer to us, so the equipment will be returned to the lessor on December 31, 2020. There is no bargain purchase option. In this condition, our company
A. is the lessee in a capital lease.
B. is the lessee in a sales-type lease.
C. is the lessor in a capital lease.
D. is the lessor in a sales-type lease
Please explain why you chose that answer.