Assume that on December 31, 2019, Kingbird Aerospace signs a 8-year, non-cancelable lease agreement to lease a hanger from Aero Field Management Company. The following information pertains to this lease agreement: 1. The agreement requires equal rental payments of $165,316 beginning on December 31, 2019. 2. The fair value of the building on December 31, 2019 is $1,118,916. 3. The building has an estimated economic life of 10 years, a guaranteed residual value of $49,000, and an expected residual value of $34,100. Kingbird depreciates similar buildings on the straight-line method. 4. The lease is nonrenewable. At the termination of the lease, the building reverts to the lessor. 5. Kingbird's incremental borrowing rate is 6% per year. The lessor's implicit rate is not known by Kingbird. Account Titles and Explanation Right-of-Use Asset Lease Liability (To record the lease) Lease Liability Cash (To record first lease payment) Amortization Expense Right-of-Use Asset (To record amortization of the right-of-use asset) Lease Liability Interest Expense Cash Debit 1,097,251 165,316 137,190 109,384 55,932 Credit 1,097,251 165,316 137,190 165,316 Amortization Expense Right-of-Use Asset (To record amortization of the right-of-use asset) Lease Liability Interest Expense Cash (To record third lease payment) 137,190 115,947 49,369 137,190 165,316 Suppose the same facts as above, except that Kingbird incurred legal fees resulting from the execution of the lease of $12,200, and received a lease incentive from Aero Field to enter the lease of $16,000. How would the initial measurement of the lease liability and right-of-use asset be affected under this situation? Right-of-use asset A