Laporte Engineering Company leased a machine on January $1,2023,$ under a contract calling for four annual payments of $$120,000$ on December $31,2023$ through $2026.$ The machine becomes the property of the lessee after the fourth payment. The machine was predicted to have a service life of six years and no residual value, and the interest rate available to Laporte Engineering was $8\%$ on the day the lease was signed. The machine was delivered on January $10,2023,$ and was immediately placed in service.

Required:

$1.$ Determine the initial net liability created by the lease and the cost of the leased asset. $($Do not round intermediate calculations. Round the final answers to the nearest whole dollar.$)$

$2.$ Prepare a table showing the calculation of the amount of interest expense allocated to each year the lease is in effect and the carrying amount of the liability at the end of each of those years. $($Do not round intermediate calculations. Round the final answers to nearest whole dollar. Enter all the amounts as positive values.$)$

$3.$ Prepare the entry to record the leasing of the machine. $($Do not round intermediate calculations. Round the final answers to the nearest whole dollar.$)$

$4.$ Prepare entries that would be made on December $31,2024,$ to record the annual depreciation on a straight$-$line basis, and the recording of the lease payment. Also show how the machine and the lease liability should appear on the December $31,2024,$ balance sheet. $($Do not round intermediate calculations. Round the final answers to nearest whole dollar. Enter all amounts as positive values.$)$