On $1$ January $20$X$2$ Grocers R Us entered into a lease to rent a mid$-$sized tractor trailer from TT Inc. with the following terms:

The company will rent a tractor$-$trailer beginning $1$ April $20$X$2$ for a $4-$year period. The fair value of the trailer is $$290,000$ and has a useful life of $5$ years. The expected residual value is $$87,000.$

Lease payments are due at the beginning of the year;

The asset reverts to the lessor at the end of the lease term. The lessee does not have any residual value guarantees.

TT$$s incremental borrowing rate is $7\mathrm{.}5\%,$ the rate implicit in the lease is $8\mathrm{.}5\%($which is known to the lessee$).$

$($PV of $$1,$ PVA of $$1,$ and PVAD of $$1.)($Use appropriate factor$($s$)$ from the tables provided.$)$

Required:

$1.$ Calculate the lease payment.

$2.$ Prepare the journal entries for the $20$X$2,20$X$3,$ and $20$X$4$ fiscal years. $($If no entry is required for a transaction$/$event$,$ select $"$No journal entry required" in the first account field.$)1$Record the initial recognition of Right$-$of$-$use asset.

$2$Record the interest expense on the lease for the year ending $31$ December $20$X$2.$

$3$Record the depreciation expense for the year ending $31$ December $20$X$2.$

$4$Record the payment of lease rental for the year ending $31$ December $20$X$3.$

$5$Record the depreciation expense for the year ending $31$ December $20$X$3.$

$6$Record the payment of lease rental for the year ending $31$ December $20$X$4.$

$7$Record the depreciation expense for the year ending $31$ December $20$X$4.$