YUM! Brands, Inc., reports the following footnote relating to its capital and operating leases in its 2012 \(10-\mathrm{K}\) report ( \(\$\) millions).

a. Confirm that the implicit rate on YUM!'s capital leases is 6.66\%. Using a 6.66\% discount rate, compute the present value of YUM!'s operating leases and rounding the remaining lease life to three decimal places. Describe the adjustments we might consider to YUM!'s balance sheet and income statement using that information.

b. YUM! reported total liabilities of \(\$ 6,699\) million for 2012 . Would the adjustment from part \(a\) make a substantial difference to YUM!'s total liabilities? Explain.

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Future minimum commitments... under noncancelable leases are set forth below. At December 29, 2012, and December 31, 2011, the present value of minimum payments under capital leases was $170 million and $279 million, respectively. Commitments ($ millions) 2013 2014. 2015 2016 2017 Thereafter. Capital $18 18 19 19 17 189 $280 Operating $ 678 634 592 556 500 2,714 $5,674