• Amazon.com, Inc. issued $10 billion in long-term bonds to fund expansion projects. The company reported the following financial data:
  • Long-term Bond Issuance: $10 billion
  • Total Assets: $250 billion
  • Total Liabilities (before issuance): $100 billion
  • Net Income: $20 billion

• Requirements:
  1. Calculate Amazon's total liabilities after issuing the long-term bonds.
  2. Prepare a balance sheet reflecting the issuance of the long-term bonds.
  3. Analyze the impact of issuing long-term debt on Amazon's debt-to-equity ratio.
  4. Discuss the interest expense associated with the long-term bonds and its impact on profitability.
  5. Evaluate Amazon's leverage ratio and its implications for financial risk management.