On $30$ June $2024,$ Knappa entered into a five$-$year lease arrangement for a shop.

The lessor gave permission for Knappa to install a wood$-$fired pizza oven on$-$site on the condition that it is removed and the shop is restored at the end of the lease arrangement on $30$ June $2029.$

To encourage Knappa to agree to the lease arrangement, the lessor offered a one$-$off cash payment of $$20,000,$ which was paid on $30$ June $2024.$

Additional information:

$-$ Five annual lease payment of $$240,000,$ payable on $30$ June each year. The first payment will be due on $30$ June $2025.$

$-$ The wood$-$fired pizza oven was installed on $30$ June $2024.$

$-$ The estimated costs to remove the wood$-$fired pizza oven and restore the shop is $$25,000$ on $30$ June $2029.$ The discounted amount of these estimated costs is correctly calculated at $$19,588$ at $30$ June $2024.$

$-$ The interest rate implicit in the lease is $8\%.$

Question $1$: For the year ended $30$ June $2024,$ prepare the journal entries to account for the above scenario. Show all workings and ignore the impact of tax.

Question $2$: Assume that the terms of the lease agreemtn impose an annual additional lease payment of Knappa based on $2\%$ of Knappa's sales revenue earned from the shop. At the commencement of the lease, Knappa's budget forecast for the shop's sales revenue is as follows:

Year ending Budgeted sales revenue

$30$ June $2025$ $$1,000,000$

$30$ June $2026$ $$1,150,000$

$30$ June $2027$ $$1,240,000$

$30$ June $2028$ $$1,700,000$

$30$ June $2029$ $$1,900,000$

Explain how the additional lease payment would be accounted for and the impact, if any, on the measure of the lease liablity at initial recognition $($reference back to IAS $17).$