Xerox 2006 Annual Report Download - page 86

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in millions, except per-share data and unless otherwise indicated)
Fair Value of Financial Instruments: The estimated fair values of our financial instruments at December 31,
2006 and 2005 were as follows:
2006 2005
(in millions)
Carrying
Amount
Fair
Value
Carrying
Amount
Fair
Value
Cash and cash equivalents ........................................... $1,399 $1,399 $1,322 $1,322
Short-term investments ............................................. 137 137 244 244
Accounts receivable, net ............................................ 2,199 2,199 2,037 2,037
Short-term debt ................................................... 1,485 1,487 1,139 1,134
Long-term debt ................................................... 5,660 5,917 6,139 6,312
Short-term liabilities to trusts issuing preferred securities(1) ................. — — 98 96
Long-term liabilities to trusts issuing preferred securities .................. 624 640 626 642
(1) Recognized as a component of Other current liabilities within the Consolidated Balance Sheet.
The fair value amounts for Cash and cash
equivalents and Accounts receivable, net approximate
carrying amounts due to the short maturities of these
instruments. The fair value of Short and Long-term debt,
as well as Liabilities to subsidiary trusts issuing preferred
securities, was estimated based on quoted market prices
for publicly traded securities or on the current rates
offered to us for debt of similar maturities. The difference
between the fair value and the carrying value represents
the theoretical net premium or discount we would pay or
receive to retire all debt at such date.
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