a) What is commercial paper, and how does Apple use it? What is the value of the outstanding commercial paper on September 25, 2021? Use the balance sheet (statement of financial position) to confirm this. What is the cost (interest rate paid by Apple) of this form of financing?
b) How much new term debt did Apple borrow in fiscal 2021? When will this new debt be repaid? Does this new debt pay fixed or variable rates of interest? What is the financing cost (interest rate) of the new term debt added in fiscal 2021?
c) What is the total term debt outstanding on the balance sheet (statement of financial position) at September 25, 2021? Why is the term debt shown this way? Find the table of future principal repayments in Note 7. What is the purpose of this table?
Apple Inc. CONSOLIDATED BALANCE SHEETS (In millions, except number of shares which are reflected in thousands and par value) September 25, 2021 September 26, 2020 ASSETS: $ Current assets: Cash and cash equivalents Marketable securities Accounts receivable, net Inventories Vendor non-trade receivables Other current assets Total current assets 34,940 $ 27,699 26,278 6,580 25,228 14,111 134,836 38,016 52,927 16,120 4,061 21,325 11,264 143,713 Non-current assets: Marketable securities Property, plant and equipment, net Other non-current assets Total non-current assets Total assets 127,877 39,440 48,849 216,166 351,002 $ 100,887 36,766 42,522 180,175 323,888 $ LIABILITIES AND SHAREHOLDERS' EQUITY: Current liabilities: Accounts payable Other current liabilities Deferred revenue Commercial paper Term debt Total current liabilities 54,763 $ 47,493 7,612 6,000 9,613 125,481 42,296 42,684 6,643 4,996 8,773 105,392 Non-current liabilities: Term debt Other non-current liabilities Total non-current liabilities Total liabilities 109, 106 53,325 43 287,912 98,667 54,490 157 258,549 Commitments and contingencies Shareholders' equity: Common stock and additional paid-in capital, $0.00001 par value: 50,400,000 shares authorized; 16,426,786 and 16,976,763 shares issued and outstanding, respectively Retained earnings Accumulated other comprehensive income/loss) Total shareholders' equity Total liabilities and shareholders' equity 57,365 5,562 163 63,090 351,002 $ 50,779 14,966 (406) 65,339 323,888 $ The future principal payments for the Company's Notes as of September 25, 2021, are as follows (in millions): 2022 $ 2023 2024 2025 9,583 11,391 10,202 10,914 11,408 64,565 118,063 2026 Thereafter Total term debt $ Apple Inc. CONSOLIDATED BALANCE SHEETS (In millions, except number of shares which are reflected in thousands and par value) September 25, 2021 September 26, 2020 ASSETS: $ Current assets: Cash and cash equivalents Marketable securities Accounts receivable, net Inventories Vendor non-trade receivables Other current assets Total current assets 34,940 $ 27,699 26,278 6,580 25,228 14,111 134,836 38,016 52,927 16,120 4,061 21,325 11,264 143,713 Non-current assets: Marketable securities Property, plant and equipment, net Other non-current assets Total non-current assets Total assets 127,877 39,440 48,849 216,166 351,002 $ 100,887 36,766 42,522 180,175 323,888 $ LIABILITIES AND SHAREHOLDERS' EQUITY: Current liabilities: Accounts payable Other current liabilities Deferred revenue Commercial paper Term debt Total current liabilities 54,763 $ 47,493 7,612 6,000 9,613 125,481 42,296 42,684 6,643 4,996 8,773 105,392 Non-current liabilities: Term debt Other non-current liabilities Total non-current liabilities Total liabilities 109, 106 53,325 43 287,912 98,667 54,490 157 258,549 Commitments and contingencies Shareholders' equity: Common stock and additional paid-in capital, $0.00001 par value: 50,400,000 shares authorized; 16,426,786 and 16,976,763 shares issued and outstanding, respectively Retained earnings Accumulated other comprehensive income/loss) Total shareholders' equity Total liabilities and shareholders' equity 57,365 5,562 163 63,090 351,002 $ 50,779 14,966 (406) 65,339 323,888 $ The future principal payments for the Company's Notes as of September 25, 2021, are as follows (in millions): 2022 $ 2023 2024 2025 9,583 11,391 10,202 10,914 11,408 64,565 118,063 2026 Thereafter Total term debt $
