On January $1,2024,$ Worcester Construction leased International Harvester equipment from Waltham LeaseCorp.

Waltham LeaseCorp purchased the equipment from Wellesley Harvester at a cost of $$977,562.$ Worcester's borrowing rate for

similar transactions is $9\%.$

The lease agreement specified four annual payments of $$220,000$ beginning January $1,2024,$ the beginning of the lease, and on

each December $31$ thereafter through $2026.$

The useful life of the equipment is estimated to be six years.

The present value of those four payments at a discount rate of $9\%$ is $$776,885.$

On January $1,2026($after two years and three payments$),$ Worcester and Waltham agreed to extend the lease term by two years. The

market rate of interest at that time was $8\%.$

Note: Use tables, Excel, or a financial calculator. $($FV of $$1,$ PV of $$1,$ FVA of $$1,$ PVA of $$1,$ FVAD of $$1$ and PVAD of $$1)$

Required:

Prepare any appropriate entry$($ies$)$ for Worcester Construction on January $1,2026,$ to record the lease modification.

Prepare all appropriate entries for Waltham LeaseCorp on January $1,2026,$ to record the lease modification.

Prepare any appropriate entry$($ies$)$ for Worcester Construction on December $31,2026,$ related to the lease.

Prepare all appropriate entries for Waltham LeaseCorp on December $31,2026,$ related to the lease.

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Complete this question by entering your answers in the tabs below.

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Prepare any appropriate entry$($ies$)$ for Worcester Construction on January $1,2026,$ to record the lease modification.

Note: If no entry is required for a transaction$/$event$,$ select $"$No journal entry required" in the first account field. Round your

intermediate and final answers to nearest whole dollar.