What is a capital lease

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At the end of 2009, Geneva Automotive, one of the largest retail auto part and supply chains, had almost 35 billion in total operating lease commitments, of which almost 2.0 billion was due in 2010. Further, the firm had total assets of 12.8 billion and total liabilities of 12.2 billion. Capital lease and related liabilities were less than 1 percent of these numbers. Because of heavy losses in previous years, its stockholders equity was only 0.6 billion

Problem 1: What is a capital lease and how does the application of capital lease accounting provide insight into a company financial health?

Reference no: EM132755032

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