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The following facts pertain to a non-cancelable lease agreement between Faldo Leasing Company a The asset will revert to the lessor at the end of the lease term. The lessee uses the straight-line mortization for all leased equipment. Suppose Pearl received a lease incentive of $5,000 from Faldo Leasing to enter the lease. How would the initial measurement of the lease liability and right-of-use asset be affected? Right-of-use asset Lease Liability What if Pearl prepaid rent of $5,000 to Faldo? Right-of-useasset $ Lease Liability $