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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
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 companys balance sheet? Over the life of the lease, what effect does this classification have on net income?
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