The Company, as a lessor, originates retail and commercial leases either directly to the consumer or indirectly through dealer networks. Retail leases consist primarily of automobiles, while

commercial leases

may

include high dollar assets such as aircraft or lower cost items such as office equipment.

The components of the net investment in

sales

-type and direct financing leases, at December 31, were as follows:


(Dollars in Millions)	2020		2019
Lease receivables	$	11,890	$	12,324
Unguaranteed residual values accruing to the lessor’s benefit		1,787		1,834

Total net investment in sales-type and direct financing leases	$	13,677	$	14,158

The Company, as a lessor, recorded $952 million and $996 million of revenue on its Consolidated Statement of Income for the years ended December 31, 2020 and 2019,

respectively, primarily consisting of interest income on sales-type and direct financing

leases

The contractual future lease payments to be received by the Company, at December 31, 2020, were as follows:


(Dollars in Millions)	Sales-type and direct financing leases			Operating leases
2021	$	4,288		$	153
2022		3,664			121
2023		2,816			83
2024		1,210			56
2025		307			38
Thereafter		496			17
Total lease payments		12,781		$	468
Amounts representing interest		(891	)
Lease receivables	$	11,890

The Company, as lessee, leases certain assets for use in its operations. Leased assets primarily include retail branches, operations centers and other corporate locations, and, to a lesser extent, office and computer equipment. For each lease with an original term greater than 12 months, the Company records a lease liability and a corresponding right of use (“ROU”) asset. At December 31, 2020, the Company’s ROU assets included in premises and equipment and lease liabilities included in long-term debt and other liabilities, were $1.1 billion and $1.3 billion,

respectively, compared with $1.3 billion of ROU assets and $1.4 billion of lease liabilities at December 31, 2019, respectively.

Total costs incurred by the Company, as a lessee, were $374 million and $394 million for the years ended December 31, 2020 and 2019, respectively, and principally related to contractual lease payments on operating leases. The Company’s leases do not impose significant covenants or other restrictions on the Company.

The following table presents amounts relevant to the Company’s assets leased for use in its operations for the years ended December 31:


(Dollars in Millions)	2020		2019
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	305	$	302
Operating cash flows from finance leases		6		7
Financing cash flows from finance leases		12		10
Right of use assets obtained in exchange for new operating lease liabilities		128		134
Right of use assets obtained in exchange for new finance lease liabilities		6		10

The following table presents the weighted-average remaining lease terms and

discount

rates of the Company’s assets leased for use in its operations at December 31:


	2020			2019
Weighted-average remaining lease term of operating leases (in years)		7.0			7.4
Weighted-average remaining lease term of finance leases (in years)		9.6			10.7
Weighted-average discount rate of operating leases		3.0	%		3.2	%
Weighted-average discount rate of finance leases		12.5	%		14.3	%

The contractual future lease obligations of the Company at December 31, 2020, were as follows:


(Dollars in Millions)	Operating leases			Finance leases
2021	$	290		$	18
2022		254			15
2023		209			15
2024		155			13
2025		111			11
Thereafter		344			29
Total lease payments		1,363			101
Amounts representing interest		(129	)		(25	)
Lease liabilities	$	1,234		$	76