In Hoenn’s FY 2018 annual report, the company disclosed the following information about its operating lease commitments (in millions)

within N Year	FY 2018	FY 2017
1	6,534	6,241
2	5,489	5,225
3	4,039	3,957
4	3,350	3,247
5	2,789	2,574
6+	7,089	6,232

 

Hoenn’s operating lease expense in 2018 is $6,800 million. Assume that Hoenn records its finance lease liabilities at an interest rate of 4 percent.

Requirement: What is the additional amount of depreciation expenses would Hoenn recognize in its 2018 annual report if all operating leases are capitalized? Please show sufficient details of your calculations, including brief explanations when necessary.

Answer rating: 100% (QA)

within N year FY 2018 FY 2017 1 6534 6241 26136 2 5489 5225 21956 3 4039 3957 16156 4 3350 3247 134 ... View the full answer