Rand Medical manufactures lithotripters. Lithotripsy uses shock waves instead of surgery to eliminate kidney stones. Physicians' Leasing purchased a lithotripter from Rand for $$2,000,000$ and leased it to Mid$-$South Urologists Group, Inc., on January $1,2024.$

$\backslash$table$[[$Lease Description:,$],[$Quarterly lease payments,$$130,516-$beginning of each period$],[$Lease term,$5$ years $(20$ quarters$)],[\backslash$table$[[$No residual value; no purchase$],[$option$]],],[$Economic life of lithotripter,$5$ years$],[$Implicit interest rate and lessee's,$],[$incremental borrowing rate,$]]$

How should this lease be classified by Mid$-$South Urologists Group and by Physicians' Leasing?

Prepare appropriate entries for both Mid$-$South Urologists Group and Physicians' Leasing from the beginning of the lease through the second rental payment on April $1,2024.$ Adjusting entries are recorded at the end of each fiscal year $($December $31).$

Assume Mid$-$South Urologists Group leased the lithotripter directly from the manufacturer, Rand Medical, which produced the machine at a cost of $$1\mathrm{.}7$ million. Prepare appropriate entries for Rand Medical from the beginning of the lease through the second lease payment on April $1,2024.$