Answer questions 22-23 from the following information.

On January 1, Lessee leases equipment with a useful life of 5 years for a three-year lease term. Payments of $35,000 are due at the beginning of each year. The incremental borrowing rate is 6%. The present value of the payments is $98,000.

22. What is lease expense for the first year?

23. What is the reduction of the lease liability for the first year?