Prepare a letter to explain the difference between operating and capital leases and answer the following questions which relate to 2011 Whole Foods Market, Inc. financial statements, unless stated otherwise.
- What is the net amount of capital lease assets on the balance sheet?
- What is the total amount of capital lease obligations on the balance sheet?
- Calculate Whole Food Market's total debt to total assets ratio.
- What entry would Whole Food Market make in 2011 to record the effects of capital leases existing at September 25, 2011? You may omit the depreciation entry.
- What is the amount of operating lease obligations on the balance sheet?
- What is the present value of operating lease payments?
- What journal entry would be made to constructively capitalize the leases? (ignore the effects of taxes)