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EQUIPMENT ON OPERATING LEASES
 12 Months Ended
Oct. 31, 2016
EQUIPMENT ON OPERATING LEASES  
EQUIPMENT ON OPERATING LEASES

14. EQUIPMENT ON OPERATING LEASES

Operating leases arise primarily from the leasing of John Deere equipment to retail customers. Initial lease terms generally range from 12 to 60 months. Net equipment on operating leases at October 31 consisted of the following in millions of dollars:

 

 

 

 

 

 

 

 

 

 

 

    

2016

    

2015

 

Equipment on operating leases:

 

 

 

 

 

 

 

Agriculture and turf

 

$
4,758

 

$
3,909

 

Construction and forestry

 

 
1,144

 

 
1,061

 

Equipment on operating leases – net

 

$
5,902

 

$
4,970

 

 

The equipment is depreciated on a straight-line basis over the terms of the lease. The accumulated depreciation on this equipment was $1,054 million and $793 million at October 31, 2016 and 2015, respectively. The corresponding depreciation expense was $742 million in 2016, $577 million in 2015 and $494 million in 2014.

Future payments to be received on operating leases totaled $1,868 million at October 31, 2016 and are scheduled in millions of dollars as follows: 2017 - $827,  2018 - $549, 2019 - $303, 2020 - $153 and 2021 - $36.

At October 31, 2016 and 2015, the company’s financial services operations had $68 million and $30 million, respectively, of deposits withheld from dealers available for potential losses on residual values.