On January 1, 2024, Quick Stream Communications leased telephone equipment from Digium, Inc. Digium’s cash selling price for the equipment is $1,306,578.
∙ The lease agreement specifies six annual payments of $300,000 beginning December 31, 2024, and on each December 31 thereafter through 2029.
∙ The six-year lease is equal to the estimated useful life of the equipment.
∙ The contract specifies that lease payments for each year will increase by the higher of (a) the increase in the Consumer Price Index for the preceding year or (b) 3%.
∙ The CPI at the beginning of the lease is 120. Digium routinely leases equipment to other firms.
∙ The interest rate in these lease arrangements is 10%.

Required:
Prepare the appropriate journal entries for Quick Stream to record the lease at its beginning date of January 1, 2024.