Current Portion of Long-Term Debt PepsiCo, Inc., reported the following information about its long-term debt in...

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
	Current Year	Preceding Year
Total long term-debt	$33,284	$28,897
Less current portion	(4,071)	(5,076)
Long-term debt	$29,213	$23,821

a. How much of the long-term debt was disclosed as a current liability on the current year's December 31 balance sheet?

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?

c. If 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?

Solutions

Expert Solution

(a) The current portion of the long term debt will be reported as current liability in the current year's December 31 balance sheet. The current portion here is $4071m which was disclosed as current liability.

(b) Current liability is the current portion of the Total long term debt here.

Preceding year current liability = $5076m

Current year current liability = $4071m

Change in current liability = Preceding year curren liability - Current year current liability

= $5076 - $4071 = $1005m

(c) If Pepsico company did not issue additional long term debt next year, then its total long term debt on December 31 will be the same as total long term debt in the current year as reduced by the current portion. Because the current portion ($4071m) of the total long term debt will be paid in the next year and the amount left willl be the total long term debt.

Total long term debt in next year:

Current year total long term debt $33284

Less: Current portion ($4071)

Total long term debt next year $29213m

ekkarill92 answered 1 year ago

Next > < Previous

Related Solutions

1)Current Portion of Long-Term Debt Connie's Bistro, Inc. reported the following information about its long-term debt...

1)Current Portion of Long-Term Debt Connie's Bistro, Inc. reported the following information about its long-term debt in the notes to a recent financial statement (in millions): Long-term debt consists of the following: December 31 Current Year Preceding Year Total long-term debt $654,000 $359,700 Less current portion (189,700) (176,600) Long-term debt $464,300 $183,100 a. How much of the long-term debt was disclosed as a current liability on the current year’s December 31 balance sheet? Current Portion of Long-Term Debt Connie's Bistro,...

Last year KRJ Enterprises reported average short-term debt of $228, average current portion of long-term debt...

Last year KRJ Enterprises reported average short-term debt of $228, average current portion of long-term debt of $126, average long-term debt of $567, and average total stockholders’ equity of $1,809. It also reported operating earnings (EBIT) of $1,159 and an effective tax rate of 22%. What was the company’s return on invested capital for the year? Present your answer in percentage terms, rounded to two decimal places, e.g., 20.00%.

1. The current portion of long-term debt should be classified as a long-term liability not be...

1. The current portion of long-term debt should be classified as a long-term liability not be separated from the long-term portion of debt be paid immediately be reclassified as a current liability 2. Which of the following would most likely be classified as a current liability? two-year notes payable bonds payable mortgage payable unearned rent 3. Allowance for Doubtful Accounts has a debit balance of $1,100 at the end of the year (before adjustment), and an analysis of customers' accounts...

What does the current portion of long term debt represent? In periods of rising prices, which...

What does the current portion of long term debt represent? In periods of rising prices, which inventory method (LIFO or FIFO) will provide you with a higher net income? Record the journal entry to write off $4,000 of receivables that were deemed uncollectible assume that $500 of the receivables written off in were subsequently collected record the journal entry to record the collection of the $500. What does a deferred tax liability represent? What does a deferred tax asset represent?

Match the following: 1. Acid-test ratio 2. Current portion of long-term debt 3. Recording a contingent...

Match the following: 1. Acid-test ratio 2. Current portion of long-term debt 3. Recording a contingent liability 4. Commercial paper 5. Deferred revenues 6. Line of credit 7. Accrual accounting 8. Interest expense 9. The riskiness of a business's obligations 10. Disclosure of a contingent liability A Cash, short-term investments, and accounts receivable all divided by current liabilities. B Loss is probable and amount is reasonably estimable. C Gift cards D Long-term debt maturing within one year. E Informal agreement...

Current liabilities include: A. Accounts receivable B. Unearned revenues. C. Portion of long-term debt that will...

Current liabilities include: A. Accounts receivable B. Unearned revenues. C. Portion of long-term debt that will be paid with noncurrent assets D. All of these E. None of these.

On December 31, Nate Inc. reported the following (in millions): Current Assets Current Liabilities Long-term Liabilities...

On December 31, Nate Inc. reported the following (in millions): Current Assets Current Liabilities Long-term Liabilities Equity $4,863 $4,544 $5,939 $1,305 What amount did the company report as total assets? Select one: a. $6,925 million b. None of the these are correct. c. $16,651 million d. $10,483 million e. $14,041 million

The following table presents information for Golden Fleece Financial. Long-term debt outstanding $ 470,000 Current yield...

The following table presents information for Golden Fleece Financial. Long-term debt outstanding $ 470,000 Current yield to maturity on debt 9.00 % Number of shares of common stock 18,500 Price per share $ 67 Book value per share $ 42 Expected rate of return on stock 18.00 % Calculate the company cost of capital.

16-20 Any balance in an unearned revenue account is reported as a(n) current liability long-term debt...

16-20 Any balance in an unearned revenue account is reported as a(n) current liability long-term debt revenue unearned liability If stock is issued for less than par value, the account Paid-In Capital in Excess of Par Value is credited. Paid-In Capital in Excess of Par Value is debited if a debit balance exists in the account Paid-In Capital in Excess of Par Value is debited if a credit balance exists in the account. Retained Earnings is credited On October 1,...

Air Taxi, Inc. has a long-term debt ratio of .48 and a current ratio of 1.27....

Air Taxi, Inc. has a long-term debt ratio of .48 and a current ratio of 1.27. Current liabilities are $3,526, sales are $10,792, profit margin is 8 percent, and ROE is 11.7 percent. What is the total of the firm's net fixed assets? Download the linked spreadsheet template and use it for your answer. Once complete, upload the template to this question. Don't forget to show your work!

Subjects