A company enters into a four$-$year lease commencing on $1$ January $20$X$1($and intends to use the

asset for four years$).$ The terms are four payments of $$90,000,$ commencing on $1$ January $20$X$1,$ and

annually thereafter. The interest rate implicit in the lease is $9\%$ and the present value of lease

payments not paid at $1$ January $20$X$1($ie three payments of $$90,000)$ discounted at that rate is

$$227,817.$ Legal costs to set up the lease incurred by the company were $$5,000.$

Required: Show the lease liability from $1$ January $20$X$1$ to $31$ December $20$X$4$ and explain the

treatment of the leased asset in the books of the lessee.