Natick Industries leased high$-$tech instruments from Framingham Leasing on January $1,2024.$ Natick has the option to renew the lease at the end of two years for an additional three years. Natick is subject to a $$45,000$ penalty after two years if it fails to renew the lease. Framingham Leasing purchased the equipment from Waltham Machines at a cost of $$250,177.$

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Related Information:

Lease term

$2$ years $(8$ quarterly periods$)$

Lease renewal option for an additional

$3$ years $(12$ quarterly periods$)$

Quarterly lease payments

$$15,000$ at Jan. $1,2024,$ and at Mar. $31,$ June $30,$ Sept. $30,$ and Dec. $31$ thereafter

Economic life of asset

$5$ years

Interest rate charged by the lessor

$8\%$

Required:

Prepare appropriate entries for Natick Industries from the beginning of the lease through March $31,2024.$ Appropriate adjusting entries are made quarterly.