Using a Calculator and Present Value Table to Impute Interest Rate and Determine Present Value of Operating Leases

AutoZone reports the following in its 2015 Form 10-K. The Company leases some of its retail stores, distribution centers, facilities, land and equipment, including vehicles. Other than vehicle leases, most of the leases are operating leases... The Company has a fleet of vehicles used for delivery to its commercial customers and stores and travel for members of field management. The majority of these vehicles are held under capital lease. Future minimum annual rental commitments under non-cancelable operating leases and capital leases were as follows at the end of fiscal 2015:

	Operating	Capital
$ thousands	Leases	Leases
2016	$259,175	$40,528
2017	250,787	40,562
2018	234,640	28,558
2019	215,692	16,845
2020	192,882	5,077
Thereafter	905,629	-
Total minimum payments required	$2,058,805	131,570
Less: interest		(3,403)
Present value of minimum capital lease payments		$128,167

a. Use a finacial calculator to impute the implicit rate of return (to three decimal places) on the capital leases. Round answer to three decimal places (ex: 0.023456 = 2.346%). Answer% b. Assume that the appropriate discount rate for the operating leases is 1.16%. Use a financial calculator to determine the present value of the future minimum operating lease payments. Round answer to the nearest dollar. $Answer c. Assume that the appropriate discount rate for the operating leases is 1%. Use presnt value tables to determine the present value of the future minimum operating lease payments. Round answer to the nearest dollar. $Answer