

in millions	February 2, 2020		February 3, 2019
Land	$	8,390	$	8,363
Buildings	18,432		18,199
Furniture, fixtures, and equipment	13,666		12,460
Leasehold improvements	1,789		1,705
Construction in progress	1,005		820
Finance leases	1,578		1,392
Property and equipment, at cost	44,860		42,939
Less accumulated depreciation and finance lease amortization	22,090		20,564
Net property and equipment	$	22,770	$	22,375



in millions	Fiscal		Fiscal		Fiscal
in millions	2019		2018		2017
Depreciation and finance lease amortization expense	$	2,223	$	2,076	$	1,983

We lease certain retail locations, office space, warehouse and distribution space, equipment, and vehicles. We consider various factors such as market conditions and the terms of any renewal options that may exist to determine whether we will renew or replace the lease. A substantial majority of our leases have remaining lease

terms of one to 20 years, typically with the option to extend the leases for up to five years. Some of our leases may include the option to terminate in less than five years. In the event we are reasonably certain to exercise the option to extend a lease, we will include the extended terms in the related lease assets and liabilities. Real estate taxes, insurance, maintenance, and operating expenses applicable to the leased property are generally our obligations under the lease agreements.

Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Further, certain lease agreements include rental payments based on an index or rate and others include rental payments based on a percentage of sales.



in millions	Consolidated Balance Sheet Caption	February 2, 2020
Assets:
Operating lease assets	Operating lease right-of-use assets	$	5,595
Finance lease assets ⁽¹⁾	Net property and equipment	934
Total lease assets		$	6,529

Liabilities:
Current:
Operating lease liabilities	Current operating lease liabilities	$	828
Finance lease liabilities	Current installments of long-term debt	84
Long-term:
Operating lease liabilities	Long-term operating lease liabilities	5,066
Finance lease liabilities	Long-term debt, excluding current installments	1,081
Total lease liabilities		$	7,059



		Fiscal
in millions	Consolidated Statement of Earnings Caption	2019
Operating lease cost	Selling, general and administrative	$	827
Finance lease cost:
Amortization of leased assets	Depreciation and amortization	86
Interest on lease liabilities	Interest expense	92
Short-term lease cost	Selling, general and administrative	98
Variable lease cost	Selling, general and administrative	241
Sublease income	Selling, general and administrative	(14		)
Net lease cost		$	1,330

ASU 2016-02 requires that public companies use a secured incremental borrowing rate as the discount rate for the present value of lease payments when the rate implicit in the contract is not readily determinable. We determine a secured rate on a quarterly basis and update the weighted average discount rate accordingly. Lease terms and discount rates follow:



	February 2, 2020
Weighted Average Remaining Lease Term (Years):
Operating leases	10
Finance leases	12

Weighted Average Discount Rate:
Operating leases	3.1	%
Finance leases	10.4	%



in millions	Operating Leases		Finance Leases
Fiscal 2020	$	955	$	172
Fiscal 2021	875		171
Fiscal 2022	772		170
Fiscal 2023	677		164
Fiscal 2024	579		148
Thereafter	2,822		948
Total lease payments	6,680		1,773
Less imputed interest	786		608
Present value of lease liabilities	$	5,894	$	1,165

Note: Amounts presented do not include payments relating to immaterial leases excluded from the consolidated balance sheets as part of transition elections adopted upon implementation of Topic 842. Additionally, we have excluded approximately $1.9 billion of leases (undiscounted basis) that have not yet commenced. These leases will commence between 2020 and 2021 with lease terms of one to 20 years.

The approximate future minimum lease payments under capital and operating leases at February 3, 2019 and accounted for under previous lease guidance follow:



in millions	Operating Leases		Capital Leases
Fiscal 2019	$	976	$	150
Fiscal 2020	912		167
Fiscal 2021	792		143
Fiscal 2022	682		142
Fiscal 2023	584		137
Thereafter	3,090		970
	$	7,036	1,709
Less imputed interest			660
Net present value of capital lease obligations			1,049
Less current installments			57
Long-term capital lease obligations, excluding current installments			$	992

Other lease information follows for fiscal 2019:



	Fiscal
in millions	2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows – operating leases	$	1,003
Operating cash flows – finance leases	92
Financing cash flows – finance leases	70
Lease assets obtained in exchange for new operating lease liabilities	748
Lease assets obtained in exchange for new finance lease liabilities	186