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Accounting

27th Edition
WARREN + 5 others
ISBN: 9781337272094

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BuyFindarrow_forward

Accounting

27th Edition
WARREN + 5 others
ISBN: 9781337272094
Textbook Problem

Current portion of long-term debt

PepsiCo, Inc, reported the following information about its long-term debt in the notes to a recent financial .statement (in millions):

Long-term debt is comprised of the following:

  December 31
Total long term-debt Current Year Previous Year
Less current portion $33,284 $28,897
Long-term debt (4.071) (5.076)
$23,821
  1. a. How much of the long-term debt was disclosed as a current liability on the current year's December 31 balance sheet?
  2. b. How much did the total current liabilities change between the preceding year and the current year as a result of the current portion of long-term debt?
  3. c. PepsiCo did not issue additional long-term debt next year, what would be the total long-term debt on December 31 of the upcoming year?

A.

To determine

Long-term debt: Long-term debt refers to the obligation of the company to be paid after one year or one operating cycle whichever is longer. Generally, the long-term debt is reported under the long-term liabilities section of the balance sheet.

Current portion of long-term debt: The amount of debt which would be paid within one year is called as current portion of long-term debt. The current portion of long-term debt is reported as a current liability.

To identify: The amount of long-term debt that was disclosed as a current liability on the current year’s December 31 balance sheet.

Explanation

The current portion of long-term debt of $4,071 million of c...

B.

To determine
The amount of change in total current liabilities between the preceding year and the current year as a result of the current portion of long-term debt.

C.

To determine

To identify: The amount of total long-term debt on December 31 of the upcoming year.

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