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Annual Report 1998 Sony Corporation [69]
16. Research and development expenses and advertising costs
Research and development expenses
Research and development expenses charged to cost of sales for the years ended March 31, 1996, 1997 and 1998
were ¥257,326 million, ¥282,569 million and ¥318,044 million ($2,409,424 thousand), respectively.
Advertising costs
Advertising costs included in selling, general and administrative expenses for the years ended March 31, 1996, 1997
and 1998 were ¥159,821 million, ¥216,579 million and ¥268,985 million ($2,037,765 thousand), respectively.
17. Leased assets
The company leases certain plant facilities, office space, warehouses, employees’ residential facilities and other assets.
An analysis of leased assets under capital leases is as follows:
Yen in millions Dollars in thousands
March 31 March 31,
Class of property 1997 1998 1998
Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 2,538 ¥ 2,501 $ 18,947
Buildings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24,623 21,682 164,257
Machinery and equipment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,682 10,103 76,538
Accumulated amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . (13,022) (12,243) (92,750)
¥23,821 ¥22,043 $166,992
The following is a schedule by year of the future minimum lease payments under capital leases together with the
present value of the net minimum lease payments as of March 31, 1998:
Year ending March 31 Yen in millions Dollars in thousands
1999 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 6,675 $ 50,568
2000 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,449 41,280
2001 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,459 33,780
2002 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,431 33,568
2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,198 31,803
Later years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,378 71,046
Total minimum lease payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34,590 262,045
Less — Amount representing interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,727 58,537
Present value of net minimum lease payments. . . . . . . . . . . . . . . . . . . . . . . . 26,863 203,508
Less — Current obligations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,135 38,902
Long-term capital lease obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥21,728 $164,606
Rental expenses under operating leases for the years ended March 31, 1996, 1997 and 1998 were ¥81,385 mil-
lion, ¥86,570 million and ¥87,564 million ($663,364 thousand), respectively. The minimum rental payments required
under operating leases that have initial or remaining noncancelable lease terms in excess of one year at March 31,
1998 are as follows:
Year ending March 31 Yen in millions Dollars in thousands
1999 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 44,269 $ 335,371
2000 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42,416 321,334
2001 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35,119 266,053
2002 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28,575 216,477
2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24,000 181,818
Later years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 158,396 1,199,970
Total minimum future rentals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥332,775 $2,521,023