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Leases
3 Months Ended
Nov. 30, 2021
Leases [Abstract]  
Leases Leases
The Company leases certain retail stores, clinics, warehouses, distribution centers, office space, land, and equipment. For the majority of leases in the U.S., the initial lease term is typically 15 to 25 years, followed by additional terms containing renewal options typically at five-year intervals, and may include rent escalation clauses. Non-U.S. leases are typically for shorter terms and may include cancellation clauses or renewal options. The commencement date of all lease terms is the earlier of the date the Company becomes legally obligated to make rent payments or the date the Company has the right to control the property. The Company recognizes operating lease rent expense on a straight-line basis over the term of the lease. In addition to minimum fixed rentals, some leases provide for contingent rentals based upon a portion of sales.

Supplemental balance sheet information related to leases were as follows (in millions):

Balance Sheet supplemental information:November 30, 2021August 31, 2021
Operating Leases:
Operating lease right-of-use assets$21,826 $21,893 
Operating lease obligations - current2,266 2,259 
Operating lease obligations - non-current 22,103 22,153 
Total operating lease obligations$24,369 $24,412 
Finance Leases:
Right-of-use assets included in:
Property, plant and equipment, net$713 $725 
Lease obligations included in:
Accrued expenses and other liabilities37 37 
Other non-current liabilities963 974 
Total finance lease obligations$1,000 $1,010 
Supplemental income statement information related to leases were as follows (in millions):
Three months ended November 30,
Statement of Earnings supplemental information:20212020
Operating lease cost
Fixed$805 $805 
Variable 1
205 158 
Finance lease cost
Amortization$11 $11 
Interest13 13 
Sublease income25 20 
Impairment of right-of-use assets68 10 
Gain on sale and leaseback 2
87 93 

1Includes real estate property taxes, common area maintenance, insurance and rental payments based on sales volume.
2Recorded within selling, general and administrative expenses.

Other supplemental information related to leases were as follows (in millions):
Three months ended November 30,
Other Supplemental Information:20212020
Cash paid for amounts included in the measurement of lease obligations:
Operating cash flows from operating leases$846 $857 
Operating cash flows from finance leases12 12 
Financing cash flows from finance leases11 10 
Total$869 $879 
Right-of-use assets obtained in exchange for new lease obligations:
Operating leases$544 $787 
Finance leases— 
Total$549 $787 

Average lease term and discount rate were as follows:
Weighted average terms and discount rates:November 30, 2021August 31, 2021
Weighted average remaining lease term in years:
Operating leases10.210.3
Finance leases20.120.2
Weighted average discount rate:
Operating leases4.75 %4.77 %
Finance leases5.18 %5.18 %
The aggregate future lease payments for operating and finance leases as of November 30, 2021 were as follows (in millions):
Future lease payments:
Fiscal yearFinance leaseOperating lease
2022 (Remaining period)$67 $2,608 
202388 3,376 
202488 3,260 
202587 3,145 
202687 3,032 
202786 2,924 
Later1,054 12,801 
Total undiscounted minimum lease payments$1,556 $31,146 
Less: Present value discount(556)(6,777)
Lease liability$1,000 $24,369 
Leases Leases
The Company leases certain retail stores, clinics, warehouses, distribution centers, office space, land, and equipment. For the majority of leases in the U.S., the initial lease term is typically 15 to 25 years, followed by additional terms containing renewal options typically at five-year intervals, and may include rent escalation clauses. Non-U.S. leases are typically for shorter terms and may include cancellation clauses or renewal options. The commencement date of all lease terms is the earlier of the date the Company becomes legally obligated to make rent payments or the date the Company has the right to control the property. The Company recognizes operating lease rent expense on a straight-line basis over the term of the lease. In addition to minimum fixed rentals, some leases provide for contingent rentals based upon a portion of sales.

Supplemental balance sheet information related to leases were as follows (in millions):

Balance Sheet supplemental information:November 30, 2021August 31, 2021
Operating Leases:
Operating lease right-of-use assets$21,826 $21,893 
Operating lease obligations - current2,266 2,259 
Operating lease obligations - non-current 22,103 22,153 
Total operating lease obligations$24,369 $24,412 
Finance Leases:
Right-of-use assets included in:
Property, plant and equipment, net$713 $725 
Lease obligations included in:
Accrued expenses and other liabilities37 37 
Other non-current liabilities963 974 
Total finance lease obligations$1,000 $1,010 
Supplemental income statement information related to leases were as follows (in millions):
Three months ended November 30,
Statement of Earnings supplemental information:20212020
Operating lease cost
Fixed$805 $805 
Variable 1
205 158 
Finance lease cost
Amortization$11 $11 
Interest13 13 
Sublease income25 20 
Impairment of right-of-use assets68 10 
Gain on sale and leaseback 2
87 93 

1Includes real estate property taxes, common area maintenance, insurance and rental payments based on sales volume.
2Recorded within selling, general and administrative expenses.

Other supplemental information related to leases were as follows (in millions):
Three months ended November 30,
Other Supplemental Information:20212020
Cash paid for amounts included in the measurement of lease obligations:
Operating cash flows from operating leases$846 $857 
Operating cash flows from finance leases12 12 
Financing cash flows from finance leases11 10 
Total$869 $879 
Right-of-use assets obtained in exchange for new lease obligations:
Operating leases$544 $787 
Finance leases— 
Total$549 $787 

Average lease term and discount rate were as follows:
Weighted average terms and discount rates:November 30, 2021August 31, 2021
Weighted average remaining lease term in years:
Operating leases10.210.3
Finance leases20.120.2
Weighted average discount rate:
Operating leases4.75 %4.77 %
Finance leases5.18 %5.18 %
The aggregate future lease payments for operating and finance leases as of November 30, 2021 were as follows (in millions):
Future lease payments:
Fiscal yearFinance leaseOperating lease
2022 (Remaining period)$67 $2,608 
202388 3,376 
202488 3,260 
202587 3,145 
202687 3,032 
202786 2,924 
Later1,054 12,801 
Total undiscounted minimum lease payments$1,556 $31,146 
Less: Present value discount(556)(6,777)
Lease liability$1,000 $24,369