On January $1,2024,$ Maywood Hydraulics leased drilling equipment from Aqua Leasing for a four$-$year period ending December $31,2027,$ at which time possession of the leased asset will revert back to Aqua.

The equipment cost Aqua $$413,307$ and has an expected economic life of five years.

Aqua and Maywood expect the residual value at December $31,2027,$ to be $$51,000.$

Negotiations led to Maywood guaranteeing a $$71,500$ residual value.

Equal payments under the lease are $$102,000$ and are due on December $31$ of each year with the first payment being made on December $31,2024.$

Maywood is aware that Aqua used a $6\%$ interest rate when calculating lease payments.

Note: Use tables, Excel, or a financial calculator. $($FV of $$1,$ PV of $$1,$ FVA of $$1,$ PVA of $$1,$ FVAD of $$1$ and PVAD of $$1)$

Required:

& $2.$ Prepare the appropriate entries for Maywood on January $1,2024$ and December $31,2024,$ related to the lease.

Note: If no entry is required for a transaction$/$event$,$ select $"$No journal entry required" in the first account field. Do not round intermediate calculations. Round your final answers to the nearest whole dollar.

$($Create answers for journal entry worksheet$)$