The company disclosed the following lease information in its 2018 annual report related to its leasing activities
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Question:
The company disclosed the following lease information in its 2018 annual report related to its leasing activities (in millions).
Capital leases | Operating leases | |
2019 | $307 | $2,471 |
2020 | 286 | 2,302 |
2021 | 262 | 1,202 |
2022 | 251 | 980 |
2023 | 116 | 830 |
After 2023 | 703 | 9,130 |
Total | $1,925 | $16,915 |
Amount representing interest | (754) | |
Present value of net minimum lease payments | $1,171 |
What effect does the failure to capitalize operating leases have on the company’s balance sheet? Over the life of the lease, what effect does this classification have on net income?
Related Book For
Financial Statement Analysis
ISBN: 978-0078110962
11th edition
Authors: K. R. Subramanyam, John Wild
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