Less$-$E Inc. leases a bulldozer from Less$-$O Inc on Jan $1$st$,2023$ for four years between Jan $1$st$,2023$ and Dec $31$st$,2026.$

$1)$ Less$-$O$$s bulldozer has a book value of $$1,000,000$ on Jan $1$st$,2023$

$2)$ Less$-$E agrees to make four equal payments to Less$-$O on the following days: Jan $1$st$,2023$; Dec $31$st$,2023$; Dec $31$st$,2024$; and Dec $31$st$,2025.$

$3)$ The useful life of the bulldozer is four years at the end of which the residual value is $150,000$

$4)$ Less$-$E$$s borrowing rate for similar transactions is $15\%.$

Let$$s assume this is a sales$-$type lease without profit for the lessor. That is$,$ the present value of the lessee$$s payments equal the book value less the present value of any residual value returned to the lessor.

Record journal entries for both the lessor and the lessee.