Capital and Operating Leases. Read the debt and lease footnotes to determine whether Amazon uses

leases.

Does the company use leases? What types of assets are leased?

What proportion of leases are capital (finance) versus operating?

Are leases a substantial component of overall financing?

Determine the discount rate implicit in the companys capital leases.

Has the company adopted the new standard for leases? If not, use the rate from above to approximate the

amount that would have been included in the balance sheet had the operating leases been capitalized. Is the

missing amount economically important?

Quantify the effect that capitalizing the operating leases would have on the following financial items and ratios

for each company: return on equity (ROE), net operating profit after tax (NOPAT), net operating assets (NOA),

and measures of financial leverage, liquidity, and solvency.