• Procter & Gamble Co. issued $3 billion in long-term bonds to finance a new production facility. The company reported the following financial information:
  • Long-term Bond Issuance: $3 billion
  • Total Assets: $150 billion
  • Total Liabilities (before issuance): $70 billion
  • Net Income: $12 billion

• Requirements:
  1. Calculate Procter & Gamble'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 Procter & Gamble's debt-to-equity ratio.
  4. Discuss the interest expense associated with the long-term bonds and its impact on profitability.
  5. Evaluate Procter & Gamble's leverage ratio and its implications for financial risk management.