Leases

12 Months Ended

Dec. 31, 2021

Leases [Abstract]

Leases

NOTE 10 — LEASES

We lease property and equipment under finance and operating leases. For leases with terms greater than 12 months, we record the related assets and obligations at the present value of lease payments over the term. Many of our leases include rental escalation clauses and renewal options that are factored into our determination of lease payments, when appropriate. We do not separate lease and nonlease components of contracts. Generally, we use our estimated incremental borrowing rate to discount the lease payments, as most of our leases do not provide a readily determinable implicit interest rate.

The following table presents our lease-related assets and liabilities at December 31, 2021 and 2020 (dollars in millions):

	Balance Sheet Classification		2021			2020
Assets:
Operating leases		Right-of-use operating lease assets	$	2,113		$	2,024
Finance leases		Property and equipment		637			553
Total lease assets			$	2,750		$	2,577
Liabilities:
Current:
Operating leases		Other accrued expenses	$	392		$	379
Finance leases		Long-term debt due within one year		143			128
Noncurrent:
Operating leases		Right-of-use operating lease obligations		1,755			1,673
Finance leases		Long-term debt		577			494
Total lease liabilities			$	2,867		$	2,674
Weighted-average remaining term:
Operating leases				10.2 years			10.4 years
Finance leases				10.4 years			11.5 years
Weighted-average discount rate:
Operating leases				4.4	%		4.8	%
Finance leases				4.4	%		5.4	%

The following table presents certain information related to lease expense for finance and operating leases for the years ended December 31, 2021, 2020 and 2019 (dollars in millions):

	2021		2020		2019
Finance lease expense:
Depreciation and amortization	$	135	$	106	$	93
Interest		29		31		32
Operating leases(1)		478		447		389
Short-term lease expense(1)		354		322		316
Variable lease expense(1)		157		154		150
	$	1,153	$	1,060	$	980

(1) Expenses are included in “other operating expenses” in our consolidated income statements.

The following table presents supplemental cash flow information for the years ended December 31, 2021, 2020 and 2019 (dollars in millions):

	2021		2020		2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases	$	474	$	445	$	404
Operating cash flows for finance leases		29		31		32
Financing cash flows for finance leases		123		86		79

Maturities of Lease Liabilities

The following table reconciles the undiscounted minimum lease payment amounts to the operating and finance lease liabilities recorded on the balance sheet at December 31, 2021 and 2020 (dollars in millions):

	2021						2020
	Operating Leases			Finance Leases			Operating Leases			Finance Leases
Year 1	$	438		$	165		$	431		$	155
Year 2		378			126			366			125
Year 3		320			132			307			81
Year 4		267			98			255			82
Year 5		219			70			207			51
Thereafter		1,148			350			1,136			353
Total minimum lease payments		2,770			941			2,702			847
Less: amount of lease payments representing interest		(623	)		(221	)		(650	)		(225	)
Present value of future minimum lease payments		2,147			720			2,052			622
Less: current lease obligations		(392	)		(143	)		(379	)		(128	)
Long-term lease obligations	$	1,755		$	577		$	1,673		$	494