Question: Refer to Apple s financial statements in Appendix A to answer

Refer to Apple’s financial statements in Appendix A to answer the following.
1. Identify the items, if any, that make up Apple’s long-term debt as reported on its balance sheet at September 28, 2013.
2. Assume that Apple has $100 million in convertible debentures that carry a 4.25% contract rate of interest. How much annual cash interest must be paid on those convertible debentures?
3. Assume that the convertible bonds discussed in part 2 are convertible into 20,000 shares of Apple’s stock. If the carrying value of these bonds is $100 million, what is the entry recorded by Apple upon conversion?

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