SELECTED NOTES TO THE FINANCIAL STATEMENTS 1. According to the consolidated balance sheets, Apple reported as "Non-current liabilities" Term debt of $109,106 and $98,667 at the ends of fiscal years 2021 and 2020, respectively. The details of these amounts appear in Note 7. a. According to Note 7, what are the required principal payments for each of the next five years (2022 through 2026)? b. Why might the detail of required principal payments be of interest to investors? c. According to the consolidated statements of cash flows, what were the net proceeds from the issuance of term debt in fiscal year 2021? 2. In Note 8, Apple provides information about its Shareholders' Equity. a How many of its shares did Apple repurchase in fiscal year 2021? How much did Apple pay in total in fiscal year 2021 for these share market repurchases? 6. Apple does not report any treasury stock on its balance sheet. How, then, did Apple account for the shares that it repurchased in fiscal year 2021? (Hint: Refer to the Consolidated Statements of Shareholders' Equity.) on taladro commerce Trout commence www ogroman 20 Note Commercial Paper and Repurchase Agreements The Company recurednom promo Comer Paper compra The Canys etc from the camera www.gr . A September 2001 and September 2000 Comandon wesen Com padamu raa the following ble provides you with them and Com 20.000 din Mes par Prodeco Margrethany Percom Hepayment of commerow peper Prochrome Tot proceed to treat commerce semed on Deere Comes coming se company account for stored or Theory during of which had been seeds of Septimber 26, 2020 Term Delt Seme. Corydom pelour officially the there sman The towing to provides summaye Companyaments.2001 Second 30 - Fouth F10- When ringar LO To management office Comas eral rate pe toaletely converted to forget responon of the Additionally, to management of foreign Smominated Company baserted editie US de entre le begro The Company age 2 on tomir 300,000 2010 vey $ 2002 2003 11 2006 2004 Total mobil As of 2011 december 2000 The Company Note 8 - Shareholders' Equity Share Repurchase Program As of September 25, 2021, the Company was authorized to purchase up to $315 billion of the Company's common stock under a share repurchase program (the "Program). During 2021, the Company repurchased 656 million shares of its common stock for $85.5 billion, including 36 million shares delivered under a $5.0 billion accelerated share repurchase agreement entered into in May 2021, bringing the total utilization under the Program to $254.1 billion as of September 25, 2021. The Program does not obligate the Company to acquire any specific number of shares. Under the Program, shares may be repurchased in privately negotiated and/or open market transactions, including under plans complying with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Shares of Common Stock The following table shows the changes in shares of common stock for 2021, 2020 and 2019 (in thousands): 2021 2020 Common stock outstanding, beginning balances 16,976,763 17,772,945 Common stock repurchased (656,340) (917,270) Common stock issued, net of shares withheld for employee taxes 106,363 121,088 Common stock outstanding, ending balances 16,426,786 16,976.763 2019 19,019,943 (1.380,819) 133,821 17.772.945 Note 7 - Debt Commercial Paper and Repurchase Agreements The Company issues unsecured short-term promissory notes ("Commercial Paper") pursuant to a commercial paper program. The Company uses net proceeds from the commercial paper program for general corporate purposes, including dividends and share repurchases. As of September 25, 2021 and September 26, 2020, the Company had $6.0 billion and $5.0 billion of Commercial Paper outstanding, respectively, with maturities generally less than nine months. The weighted average interest rate of the Company's Commercial Paper was 0.06% and 0.62% as of September 25, 2021 and September 26, 2020, respectively. The following table provides a summary of cash flows associated with the issuance and maturities of Commercial Paper for 2021, 2020 and 2019 (in millions): 2021 2020 2019 Maturities 90 days or less: Proceeds from/(Repayments of commercial paper, net (357) $ 100 $ (3,248) Maturities greater than 90 days: Proceeds from commercial paper Repayments of commercial paper Proceeds from/(Repayments of commercial paper, net 7,946 (6,567) 1,379 6,185 (7.248) (1,063) 13,874 (16,603) (2.729) Total proceeds from/(repayments of commercial paper, net 1,022 $ (963) $ (5,977) In 2020, the Company entered into agreements to sell certain of its marketable securities with a promise to repurchase the securities at a specified time and amount ("Repos"). Due to the Company's continuing involvement with the marketable securities, the Company accounted for its Repos as collateralized borrowings. The Company entered into $5.2 billion of Repos during 2020, all of which had been settled as of September 26, 2020. Term Debt As of September 25, 2021, the Company had outstanding floating- and fixed-rate notes with varying maturities for an aggregate principal amount of $118.1 billion (collectively the "Notes"). The Notes are senior unsecured obligations and interest is payable in arrears. The following table provides a summary of the Company's term debt as of September 25, 2021 and September 26, 2020: 2021 2020 Maturities Amount Effective Amount Effective (calendar year) (in Millions) Interest Rate in millions) Interest Rate 2013-2020 debt issuances: Floating-rate notes 2022 $ 1.750 0.48%-0.63% $ 2.250 0.60% -1.39% Fixed-rate 0.000% -4.650 notes 2022 - 2060 95,813 0.03% -4.78% 103.828 0.03% -4.78 Second quarter 2021 debt issuance Fixed-rato 0.700% -2.800% notes 14.000 0.75%-281% Fourth quarter 2021 debt issuance: Foxed-rate 1.400% -2850 notes 2028-2051 6,500 1.43%-2.86% Totalterm debt 118,063 106,078 2026 - 2061 Unamortized premium (discount) and issuance costs, net Hedge accounting fair value adjustments Less Current portion of term debe Total non-current portion of term debt (380) 1,036 (9,613) 109.106 (314) 1.676 (8.773) 98.667 To manage interest rate risk on certain of its U.S. dollar-denominated fixed- or floating-rate notes, the Company has entered into interest rate swaps to effectively convert the foxed interest rates to floating interest rates or the floating interest rates to fixed interest rates on a portion of these notes. Additionally, to manage foreign currency risk on certain of its foreign currency denominated notes, the Company has entered into foreign currency swaps to effectively convert these noles to U.S. dolar- denominated notes. The effective interest rates for the Notes include the interest on the Notes, amortization of the discount or premium and, it applicable, adjustments related to hedging. The Company recognized $2.6 billion, $2.8 billion and $3.2 billion of interest expense on its term debt for 2021, 2020 and 2019, respectively The future principal payments for the Company's Notes as of September 25, 2021, are as follows (in Millions): 2022 $ 9,583 2023 11,391 2024 10,202 2025 10,914 2026 11,408 Thereafter 64.565 Total term debt 118,063 As of September 25, 2021 and September 26, 2020, the fair value of the Company's Notes, based on Level 2 inputs, was $125.3 billion and $117.1 billion, respectively SELECTED NOTES TO THE FINANCIAL STATEMENTS 1. According to the consolidated balance sheets, Apple reported as "Non-current liabilities" Term debt of $109,106 and $98,667 at the ends of fiscal years 2021 and 2020, respectively. The details of these amounts appear in Note 7. a. According to Note 7, what are the required principal payments for each of the next five years (2022 through 2026)? b. Why might the detail of required principal payments be of interest to investors? c. According to the consolidated statements of cash flows, what were the net proceeds from the issuance of term debt in fiscal year 2021? 2. In Note 8, Apple provides information about its Shareholders' Equity. a How many of its shares did Apple repurchase in fiscal year 2021? How much did Apple pay in total in fiscal year 2021 for these share market repurchases? 6. Apple does not report any treasury stock on its balance sheet. How, then, did Apple account for the shares that it repurchased in fiscal year 2021? (Hint: Refer to the Consolidated Statements of Shareholders' Equity.) on taladro commerce Trout commence www ogroman 20 Note Commercial Paper and Repurchase Agreements The Company recurednom promo Comer Paper compra The Canys etc from the camera www.gr . A September 2001 and September 2000 Comandon wesen Com padamu raa the following ble provides you with them and Com 20.000 din Mes par Prodeco Margrethany Percom Hepayment of commerow peper Prochrome Tot proceed to treat commerce semed on Deere Comes coming se company account for stored or Theory during of which had been seeds of Septimber 26, 2020 Term Delt Seme. Corydom pelour officially the there sman The towing to provides summaye Companyaments.2001 Second 30 - Fouth F10- When ringar LO To management office Comas eral rate pe toaletely converted to forget responon of the Additionally, to management of foreign Smominated Company baserted editie US de entre le begro The Company age 2 on tomir 300,000 2010 vey $ 2002 2003 11 2006 2004 Total mobil As of 2011 december 2000 The Company Note 8 - Shareholders' Equity Share Repurchase Program As of September 25, 2021, the Company was authorized to purchase up to $315 billion of the Company's common stock under a share repurchase program (the "Program). During 2021, the Company repurchased 656 million shares of its common stock for $85.5 billion, including 36 million shares delivered under a $5.0 billion accelerated share repurchase agreement entered into in May 2021, bringing the total utilization under the Program to $254.1 billion as of September 25, 2021. The Program does not obligate the Company to acquire any specific number of shares. Under the Program, shares may be repurchased in privately negotiated and/or open market transactions, including under plans complying with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Shares of Common Stock The following table shows the changes in shares of common stock for 2021, 2020 and 2019 (in thousands): 2021 2020 Common stock outstanding, beginning balances 16,976,763 17,772,945 Common stock repurchased (656,340) (917,270) Common stock issued, net of shares withheld for employee taxes 106,363 121,088 Common stock outstanding, ending balances 16,426,786 16,976.763 2019 19,019,943 (1.380,819) 133,821 17.772.945 Note 7 - Debt Commercial Paper and Repurchase Agreements The Company issues unsecured short-term promissory notes ("Commercial Paper") pursuant to a commercial paper program. The Company uses net proceeds from the commercial paper program for general corporate purposes, including dividends and share repurchases. As of September 25, 2021 and September 26, 2020, the Company had $6.0 billion and $5.0 billion of Commercial Paper outstanding, respectively, with maturities generally less than nine months. The weighted average interest rate of the Company's Commercial Paper was 0.06% and 0.62% as of September 25, 2021 and September 26, 2020, respectively. The following table provides a summary of cash flows associated with the issuance and maturities of Commercial Paper for 2021, 2020 and 2019 (in millions): 2021 2020 2019 Maturities 90 days or less: Proceeds from/(Repayments of commercial paper, net (357) $ 100 $ (3,248) Maturities greater than 90 days: Proceeds from commercial paper Repayments of commercial paper Proceeds from/(Repayments of commercial paper, net 7,946 (6,567) 1,379 6,185 (7.248) (1,063) 13,874 (16,603) (2.729) Total proceeds from/(repayments of commercial paper, net 1,022 $ (963) $ (5,977) In 2020, the Company entered into agreements to sell certain of its marketable securities with a promise to repurchase the securities at a specified time and amount ("Repos"). Due to the Company's continuing involvement with the marketable securities, the Company accounted for its Repos as collateralized borrowings. The Company entered into $5.2 billion of Repos during 2020, all of which had been settled as of September 26, 2020. Term Debt As of September 25, 2021, the Company had outstanding floating- and fixed-rate notes with varying maturities for an aggregate principal amount of $118.1 billion (collectively the "Notes"). The Notes are senior unsecured obligations and interest is payable in arrears. The following table provides a summary of the Company's term debt as of September 25, 2021 and September 26, 2020: 2021 2020 Maturities Amount Effective Amount Effective (calendar year) (in Millions) Interest Rate in millions) Interest Rate 2013-2020 debt issuances: Floating-rate notes 2022 $ 1.750 0.48%-0.63% $ 2.250 0.60% -1.39% Fixed-rate 0.000% -4.650 notes 2022 - 2060 95,813 0.03% -4.78% 103.828 0.03% -4.78 Second quarter 2021 debt issuance Fixed-rato 0.700% -2.800% notes 14.000 0.75%-281% Fourth quarter 2021 debt issuance: Foxed-rate 1.400% -2850 notes 2028-2051 6,500 1.43%-2.86% Totalterm debt 118,063 106,078 2026 - 2061 Unamortized premium (discount) and issuance costs, net Hedge accounting fair value adjustments Less Current portion of term debe Total non-current portion of term debt (380) 1,036 (9,613) 109.106 (314) 1.676 (8.773) 98.667 To manage interest rate risk on certain of its U.S. dollar-denominated fixed- or floating-rate notes, the Company has entered into interest rate swaps to effectively convert the foxed interest rates to floating interest rates or the floating interest rates to fixed interest rates on a portion of these notes. Additionally, to manage foreign currency risk on certain of its foreign currency denominated notes, the Company has entered into foreign currency swaps to effectively convert these noles to U.S. dolar- denominated notes. The effective interest rates for the Notes include the interest on the Notes, amortization of the discount or premium and, it applicable, adjustments related to hedging. The Company recognized $2.6 billion, $2.8 billion and $3.2 billion of interest expense on its term debt for 2021, 2020 and 2019, respectively The future principal payments for the Company's Notes as of September 25, 2021, are as follows (in Millions): 2022 $ 9,583 2023 11,391 2024 10,202 2025 10,914 2026 11,408 Thereafter 64.565 Total term debt 118,063 As of September 25, 2021 and September 26, 2020, the fair value of the Company's Notes, based on Level 2 inputs, was $125.3 billion and $117.1 billion, respectively