Question
AMR Corp. disclosed the following lease information in its 2011 annual report related to its leasing activities (in millions). Capital Leases Operating Leases 2012 $
AMR Corp. disclosed the following lease information in its 2011 annual report related to its leasing activities (in millions).
| Capital Leases | Operating Leases |
2012 | $ 167 | $ 1,176 |
2013 | 149 | 1,091 |
2014 | 129 | 942 |
2015 | 118 | 779 |
2016 | 78 | 685 |
Thereafter | 477 | 5,940 |
Total | 1,118 | $10,613 |
Amount representing interest | (439) |
|
Present value of net minimum lease payments | $ 679 |
|
a. What did AMR report on its 2011 balance sheet related to leases?
b. Calculate the lease-related liabilities that are potentially missing from AMRs 2011 balance sheet. Assume a discount rate of 11% and assume that the payments made in 2017 and beyond are made in 9 installments.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started