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LEASES (Tables)

3 Months Ended

Mar. 30, 2019

The components of lease expense were as follows:

	March 30,
(In millions)	2019
Finance lease cost:
Amortization of right-of-use assets	$	4
Interest on lease liabilities		1
Operating lease cost		111
Short-term lease cost		3
Variable lease cost		33
Total lease cost	$	152

Supplemental Cash Flow Information Related to Leases

Supplemental cash flow information related to leases was as follows:

	March 30,
(In millions)	2019
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from finance leases	$	1
Operating cash flows from operating leases		125
Financing cash flows from finance leases		5
Right-of-use assets obtained in exchange for new finance lease liabilities		2
Right-of-use assets obtained in exchange for new operating lease liabilities		53

Supplemental Balance Sheet Information Related to Leases

Supplemental balance sheet information related to leases was as follows:

	March 30,
(In millions, except lease term and discount rate)	2019
Property and equipment, net	$	41
Operating lease right-of-use assets		1,398
Accrued expenses and other current liabilities		370
Short-term borrowings and current maturities of long-term debt		16
Long-term debt, net of current maturities		53
Operating lease liabilities		1,208
Weighted-average remaining lease term – finance leases	5 years
Weighted-average remaining lease term – operating leases	5 years
Weighted-average discount rate – finance leases		6.9	%
Weighted-average discount rate – operating leases		7.0	%

Schedule of Maturities of Lease Liabilities Under Operating and Finance Leases

Maturities of lease liabilities as of March 30, 2019 were as follows:

	March 30, 2019
	Operating			Finance
(In millions)	Leases⁽¹⁾			Leases
2019 (excluding the first quarter of 2019)	$	546		$	16
2020		479			16
2021		338			14
2022		254			12
2023		178			11
Thereafter		132			15
		1,927			84
Less imputed interest		(349	)		(15	)
Total	$	1,578		$	69

Reported as of March 30, 2019
Accrued expenses and other current liabilities	$	370		$	—
Short-term borrowings and current maturities of long-term debt		—			16
Long-term debt, net of current maturities		—			53
Operating lease liabilities		1,208			—
Total	$	1,578		$	69

(1)

Operating lease payments include $155 million related to options to extend lease terms that are reasonably certain of being exercised and exclude $2 million of legally binding lease payments for an additional operating lease signed but not yet commenced. This operating lease will commence in fiscal year 2019 with a lease term of 10 years.

Future Minimum Lease Payments due under Non-Cancelable Portions of Leases

The table below represents future minimum lease payments due under the non-cancelable portions of leases including facility leases that were accrued as store closure costs as of December 29, 2018. The table was updated from the version previously included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 29, 2018 within the Notes to Consolidated Financial Statements to adjust for certain inconsistencies that management identified in the first quarter of fiscal year 2019 during the implementation of ASC 842, Leases. Specifically, the Company corrected the schedule to include additional lease commitments for option periods at the time of execution as opposed to the original extension date.

	December 29,
(In millions)	2018
2019	$	466
2020		374
2021		285
2022		214
2023		144
Thereafter		235
		1,718
Less sublease income		(11	)
Total	$	1,707