The following facts pertain to a non-cancelable lease agreement between Faldo Leasing Company and Bridgeport Company, a lessee.

Commencement date		January 1,
Annual lease payment due at the beginning of each year, beginning with January 1,		$109,209
Residual value of equipment at end of lease term, guaranteed by the lessee		$52,000
Expected residual value of equipment at end of lease term		$47,000
Lease term		6	years
Economic life of leased equipment		6	years
Fair value of asset at January 1,		$565,000
Lessors implicit rate		9	%
Lessees incremental borrowing rate		9	%

The asset will revert to the lessor at the end of the lease term. The lessee uses the straight-line amortization for all leased equipment. Click here to view factor tables.

Suppose Bridgeport 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		$enter a dollar amount
Lease Liability		$enter a dollar amount

What if Bridgeport prepaid rent of $5,000 to Faldo?

Right-of-use asset		$enter a dollar amount
Lease Liability		$enter a dollar amount