Laughing Inc. sells computer systems. Laughing leases computers to MI Company on January $1,2021.$ The manufacturing cost of the computers was $$12$ million. $$This noncancelable lease had the following terms:

Lease payments: $$2,466,754$ semiannually; first payment at January $1,2021$; remaining payments at June $30$ and December $31$ each year through June $30,2025.$

Lease term: five years $(10$ semiannual payments$).$

No residual value; no purchase option.

Economic life of equipment: five years.

Implicit interest rate and lessee's incremental borrowing rate: $5\%$ semiannually.

Fair value of the computers at January $1,2021$: $$20$ million.