Leases

12 Months Ended

Dec. 31, 2019

Lease Accounting

Components of Lease Expense



	2019
Operating lease cost	$	115
Finance lease cost
Amortization of right-of-use assets	3
Interest on lease liabilities	3
Total finance lease cost	6
Sublease income	(69		)

Rental expense related to operating leases was $151 million and $214 million for the years ended December 31, 2018 and 2017, respectively.

Supplemental Cash Flow Information



	2019
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	104
Operating cash flows from finance leases	3
Financing cash flows from finance leases	4
Right-of-use assets obtained in exchange for lease obligations
Operating leases	79
Finance leases	14

Supplemental Balance Sheet Information



	2019			Consolidated Balance Sheet
Assets
Operating lease right-of-use assets	$	642		Other assets
Finance lease right-of-use assets	42			Property, plant and equipment, net
Total right-of-use assets^(a)	$	684

Liabilities
Current
Operating	$	67		Accounts payable and other current liabilities
Finance	7			Short-term borrowings
Non-current
Operating	640			Other liabilities and deferred credits
Finance	70			Long-term debt
Total lease liabilities^(a)	$	784

Weighted-average Remaining Lease Term (in years)
Operating leases	12.3
Finance leases	12.7

Weighted-average Discount Rate
Operating leases	5.6		%
Finance leases	6.6		%


(a)	U.S. operating lease right-of-use assets and liabilities totaled $283 million and $337 million, respectively, as of December 31, 2019. These amounts primarily related to Taco Bell U.S. including leases related to Company-operated restaurants, leases related to franchise-operated restaurants we sublease and the Taco Bell restaurant support center.

Maturity of Lease Payments and Receivables

Future minimum lease payments, including rental payments for lease renewal options we are reasonably certain to exercise, and amounts to be received as lessor or sublessor as of December 31, 2019 were as follows:



	Commitments						Lease Receivables
	Finance			Operating			Direct Financing			Operating
2020	$	11		$	105		$	5		$	81
2021	11			100			4			76
2022	9			92			4			72
2023	9			83			4			69
2024	8			76			3			65
Thereafter	62			531			28			601
Total lease payments/receipts	110			987			48			$	964
Less imputed interest/unearned income	(33		)	(280		)	(18		)
Total lease liabilities/receivables	$	77		$	707		$	30

As of December 31, 2019, we have executed real estate leases that have not yet commenced with estimated future lease payments of approximately $46 million, which are not included in the tables above. These leases are expected to commence in 2020 with lease terms of up to 20 years.

Future minimum lease payments and amounts to be received as lessor or sublessor under the non-cancellable term of leases as of December 31, 2018 as required to be disclosed under Legacy Lease GAAP were as follows:



	Commitments				Lease Receivables
	Capital		Operating		Direct Financing		Operating
2019	$	10	$	103	$	6	$	89
2020	10		89		5		79
2021	9		78		4		74
2022	8		71		4		69
2023	8		61		3		67
Thereafter	58		384		30		638
	$	103	$	786	$	52	$	1,016