Boeing 2008 Annual Report Download - page 88

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Note 8 – Customer Financing
Customer financing at December 31 consisted of the following:
2008 2007
Aircraft financing
Notes receivable $ 615 $ 770
Investment in sales-type/finance leases 2,528 2,676
Operating lease equipment, at cost, less accumulated depreciation of $771
and $1,024 3,152 3,601
Other financing
Notes receivable 256 115
Operating lease equipment, at cost, less accumulated depreciation of $90 138
Less allowance for losses on receivables (269) (195)
$6,282 $7,105
The components of investment in sales-type/finance leases at December 31 were as follows:
2008 2007
Minimum lease payments receivable $ 3,451 $ 3,814
Estimated residual value of leased assets 735 751
Unearned income (1,658) (1,889)
$ 2,528 $ 2,676
Aircraft financing operating lease equipment primarily includes jet and commuter aircraft. At
December 31, 2008 and 2007, aircraft financing operating lease equipment included $685 of
equipment available for sale or re-lease and $86 of equipment available for re-lease. At December 31,
2008 and 2007, we had firm lease commitments for $305 and $86 of this equipment.
When our Commercial Airplanes segment is unable to immediately sell used aircraft, it may place the
aircraft under an operating lease. It may also provide customer financing with a note receivable. The
carrying amount of the Commercial Airplanes segment used aircraft under operating leases and notes
receivable included as a component of customer financing totaled $232 and $156 as of December 31,
2008 and 2007.
Impaired receivables and the allowance for losses on those receivables consisted of the following at
December 31:
2008 2007
Impaired receivables with no specific impairment allowance $163 $197
Impaired receivables with specific impairment allowance 16 39
Allowance for losses on impaired receivables 813
The average recorded investment in impaired receivables as of December 31, 2008, 2007 and 2006,
was $197, $589, and $1,191, respectively. Income recognition is generally suspended for receivables
at the date full recovery of income and principal becomes doubtful. Income is recognized when
receivables become contractually current and performance is demonstrated by the customer. Interest
income recognized on such receivables was $14, $50, and $104 for the years ended December 31,
2008, 2007 and 2006, respectively.
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