PROBLEMS aefer to the financial statements of Campbell Soup Company in Appendix A Campbell Soup PROBLEM 3-1 Interpreting Notes Payable and Lease Disclosures Required Campbell Soup Company has zero coupon notes payable outstanding 8 (1) Indicate the total amount due noteholders on the maturity date of these notes. (2) The iability for these notes is lower than the maturity value. Describe the pattern in the reported amounts for this liability in future years. (3) Ignoring dollar amounts, prepare the annual journal entry that Campbell Soup Company makes to record b. Campbell Soup reports long-term debt on the balance sheet totaling $772.6 million. Conceptually, what does the c. The note on leases reports future minimum lease payments under capital leases as $28.0 million and the d. dentify where in the financial statements that Campbell Soup reports the payment obligation for operating e. Predict what interest expense will be in Year 12 assuming no substantial change in the debt structure (Hint CHEC the liability for accrued interest amount $772.6 represent? Over what years will cash outflows occur as related to this debt? present value of such payments as $21.5 million. Identify which amount is actually paid in future years leases of $71.9 million. identify the substantial interest-bearing obligations of the company and multiply that balance times an appro- (e) Rate is 11.53% riate estimate of the effective rate for that debt). PROBLEMS aefer to the financial statements of Campbell Soup Company in Appendix A Campbell Soup PROBLEM 3-1 Interpreting Notes Payable and Lease Disclosures Required Campbell Soup Company has zero coupon notes payable outstanding 8 (1) Indicate the total amount due noteholders on the maturity date of these notes. (2) The iability for these notes is lower than the maturity value. Describe the pattern in the reported amounts for this liability in future years. (3) Ignoring dollar amounts, prepare the annual journal entry that Campbell Soup Company makes to record b. Campbell Soup reports long-term debt on the balance sheet totaling $772.6 million. Conceptually, what does the c. The note on leases reports future minimum lease payments under capital leases as $28.0 million and the d. dentify where in the financial statements that Campbell Soup reports the payment obligation for operating e. Predict what interest expense will be in Year 12 assuming no substantial change in the debt structure (Hint CHEC the liability for accrued interest amount $772.6 represent? Over what years will cash outflows occur as related to this debt? present value of such payments as $21.5 million. Identify which amount is actually paid in future years leases of $71.9 million. identify the substantial interest-bearing obligations of the company and multiply that balance times an appro- (e) Rate is 11.53% riate estimate of the effective rate for that debt)
