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Leases
 12 Months Ended
Dec. 31, 2020
Leases [Abstract]  
Leases, Operating LEASES
We determine at its inception whether an arrangement that provides us control over the use of an asset is a lease. We recognize at lease commencement a right-of-use (ROU) asset and lease liability based on the present value of the future lease payments over the lease term. We have elected not to recognize an ROU asset and lease liability for leases with terms of 12 months or less. Some of our leases include options to extend the term of the lease for up to 30 years or to terminate the lease within 1 year. When it is reasonably certain that we will exercise the option, we include the impact of the option in the lease term for purposes of determining total future lease payments. As most of our lease agreements do not explicitly state the discount rate implicit in the lease, we use our incremental borrowing rate on the commencement date to calculate the present value of future payments.
Our leases commonly include payments that are based on the Consumer Price Index (CPI) or other similar indices. These variable lease payments are included in the calculation of the ROU asset and lease liability. Other variable lease payments, such as usage-based amounts, are excluded from the ROU asset and lease liability, and are expensed as incurred. In addition to the present value of the future lease
payments, the calculation of the ROU asset also includes any deferred rent, lease pre-payments and initial direct costs of obtaining the lease, such as commissions.
In addition to the base rent, real estate leases typically contain provisions for common-area maintenance and other similar services, which are considered non-lease components for accounting purposes. For our real estate leases, we apply a practical expedient to include these non-lease components in calculating the ROU asset and lease liability. For all other types of leases, non-lease components are excluded from our ROU assets and lease liabilities and expensed as incurred.
Our leases are for office space, manufacturing facilities, and machinery and equipment. Real estate represents over 75% of our lease obligations.
The components of lease costs were as follows:
Year Ended December 3120202019
Finance lease cost:
    Amortization of right-of-use assets$94 $86 
    Interest on lease liabilities25 24 
Operating lease cost326 332 
Short-term lease cost62 75 
Variable lease cost12 14 
Sublease income(16)(13)
Total lease costs, net$503 $518 
Additional information related to leases was as follows:
Year Ended December 3120202019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases
$323 $325 
Operating cash flows from finance leases
25 24 
Financing cash flows from finance leases
64 57 
Right-of-use assets obtained in exchange for lease liabilities:
Operating leases
205 365 
Finance leases
45 50 
Additional quantitative lease information was as follows:
December 3120202019
Weighted-average remaining lease term:
Operating leases
10.5 years10.7 years
Finance leases
10.1 years6.1 years
Weighted-average discount rate:
Operating leases
3 %3 %
Finance leases
7 %8 %
The following is a reconciliation of future undiscounted cash flows to the operating and finance lease liabilities, and the related ROU assets, presented on the Consolidated Balance Sheet on December 31, 2020:
Year Ended December 31Operating LeasesFinance Leases
2021$298 $87 
2022252 86 
2023192 38 
2024156 21 
2025107 19 
Thereafter705 145 
Total future lease payments1,710 396 
Less imputed interest299 73 
Present value of future lease payments1,411 323 
Less current portion of lease liabilities262 68 
Long-term lease liabilities$1,149 $255 
ROU assets$1,328 $333 
On December 31, 2019, operating and finance lease liabilities and the related ROU assets were as follows:
Operating LeasesFinance Leases
Current portion of lease liabilities$252 $67 
Long-term lease liabilities1,251 287 
ROU assets1,432 391 
Lease liabilities are included on the Consolidated Balance Sheet in current and noncurrent other liabilities, while ROU assets are included in noncurrent other assets.
On December 31, 2020, we had additional future payments on leases that had not yet commenced of $79. These leases will commence in 2021 and 2022, and have lease terms of 1 to 20 years.
Leases, Financing LEASES
We determine at its inception whether an arrangement that provides us control over the use of an asset is a lease. We recognize at lease commencement a right-of-use (ROU) asset and lease liability based on the present value of the future lease payments over the lease term. We have elected not to recognize an ROU asset and lease liability for leases with terms of 12 months or less. Some of our leases include options to extend the term of the lease for up to 30 years or to terminate the lease within 1 year. When it is reasonably certain that we will exercise the option, we include the impact of the option in the lease term for purposes of determining total future lease payments. As most of our lease agreements do not explicitly state the discount rate implicit in the lease, we use our incremental borrowing rate on the commencement date to calculate the present value of future payments.
Our leases commonly include payments that are based on the Consumer Price Index (CPI) or other similar indices. These variable lease payments are included in the calculation of the ROU asset and lease liability. Other variable lease payments, such as usage-based amounts, are excluded from the ROU asset and lease liability, and are expensed as incurred. In addition to the present value of the future lease
payments, the calculation of the ROU asset also includes any deferred rent, lease pre-payments and initial direct costs of obtaining the lease, such as commissions.
In addition to the base rent, real estate leases typically contain provisions for common-area maintenance and other similar services, which are considered non-lease components for accounting purposes. For our real estate leases, we apply a practical expedient to include these non-lease components in calculating the ROU asset and lease liability. For all other types of leases, non-lease components are excluded from our ROU assets and lease liabilities and expensed as incurred.
Our leases are for office space, manufacturing facilities, and machinery and equipment. Real estate represents over 75% of our lease obligations.
The components of lease costs were as follows:
Year Ended December 3120202019
Finance lease cost:
    Amortization of right-of-use assets$94 $86 
    Interest on lease liabilities25 24 
Operating lease cost326 332 
Short-term lease cost62 75 
Variable lease cost12 14 
Sublease income(16)(13)
Total lease costs, net$503 $518 
Additional information related to leases was as follows:
Year Ended December 3120202019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases
$323 $325 
Operating cash flows from finance leases
25 24 
Financing cash flows from finance leases
64 57 
Right-of-use assets obtained in exchange for lease liabilities:
Operating leases
205 365 
Finance leases
45 50 
Additional quantitative lease information was as follows:
December 3120202019
Weighted-average remaining lease term:
Operating leases
10.5 years10.7 years
Finance leases
10.1 years6.1 years
Weighted-average discount rate:
Operating leases
3 %3 %
Finance leases
7 %8 %
The following is a reconciliation of future undiscounted cash flows to the operating and finance lease liabilities, and the related ROU assets, presented on the Consolidated Balance Sheet on December 31, 2020:
Year Ended December 31Operating LeasesFinance Leases
2021$298 $87 
2022252 86 
2023192 38 
2024156 21 
2025107 19 
Thereafter705 145 
Total future lease payments1,710 396 
Less imputed interest299 73 
Present value of future lease payments1,411 323 
Less current portion of lease liabilities262 68 
Long-term lease liabilities$1,149 $255 
ROU assets$1,328 $333 
On December 31, 2019, operating and finance lease liabilities and the related ROU assets were as follows:
Operating LeasesFinance Leases
Current portion of lease liabilities$252 $67 
Long-term lease liabilities1,251 287 
ROU assets1,432 391 
Lease liabilities are included on the Consolidated Balance Sheet in current and noncurrent other liabilities, while ROU assets are included in noncurrent other assets.
On December 31, 2020, we had additional future payments on leases that had not yet commenced of $79. These leases will commence in 2021 and 2022, and have lease terms of 1 to 20 years.