SEC Info - Pepsico Inc - ‘10-K’ for 12/25/10

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Pepsico Inc – ‘10-K’ for 12/25/10 – ‘XML.R23’

On: Friday, 2/18/11, at 4:57pm ET · For: 12/25/10 · Accession #: 1193125-11-40427 · File #: 1-01183

  As Of               Filer                 Filing    For·On·As Docs:Size             Issuer                      Filing Agent

 2/18/11  Pepsico Inc                       10-K       12/25/10  113:25M                                    Donnelley … Solutions/FA

Annual Report — Form 10-K — Sect. 13 / 15(d) – SEA’34
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-K        Annual Report                                       HTML   1.74M 
 2: EX-10.63    Amendment to the Pepsico Pension Equalization Plan  HTML     47K 
 3: EX-10.64    Retention Agreement                                 HTML    135K 
 4: EX-10.65    Pbg Pension Equalization Plan (Plan Document for    HTML    206K 
                the 409A Program)                                                
 5: EX-10.66    Pbg Pension Equalization Plan (Plan Document for    HTML    202K 
                the Pre-409A Program)                                            
 6: EX-10.67    Pbg Executive Income Deferral Program (Plan         HTML    209K 
                Document for the 409A Program)                                   
 7: EX-10.68    Pbg Executive Income Deferral Program (Plan         HTML    201K 
                Document for the Pre-409A Program)                               
 9: EX-14       Worldwide Code of Conduct                           HTML     60K 
10: EX-21       Subsidiaries of Pepsico, Inc                        HTML    251K 
11: EX-23       Consent of Kpmg LLP                                 HTML     46K 
12: EX-24       Power of Attorney                                   HTML     70K 
 8: EX-12       Computation of Ratio of Earnings to Fixed Charges   HTML     55K 
13: EX-31       Certification of Our CEO and CFO Pursuant to        HTML     51K 
                Section 302                                                      
14: EX-32       Certification of Our CEO and CFO Pursuant to        HTML     38K 
                Section 906                                                      
86: XML         IDEA XML File -- Definitions and References          XML    404K 
101: XML         IDEA XML File -- Filing Summary                      XML    464K  
96: XML.R1      Document and Entity Information                      XML    226K 
97: XML.R2      Consolidated Statement of Income                     XML    264K 
55: XML.R3      Consolidated Statement of Cash Flows                 XML    772K 
63: XML.R4      Consolidated Balance Sheet                           XML    408K 
84: XML.R5      Consolidated Balance Sheet (Parenthetical)           XML    101K 
80: XML.R6      Consolidated Statement of Equity                     XML   2.53M 
108: XML.R7      Comprehensive Income                                 XML    221K  
32: XML.R8      Basis of Presentation and Our Divisions              XML    264K 
79: XML.R9      Our Significant Accounting Policies                  XML     73K 
28: XML.R10     Restructuring, Impairment and Integration Charges    XML    139K 
27: XML.R11     Property, Plant and Equipment and Intangible         XML    219K 
                Assets                                                           
54: XML.R12     Income Taxes                                         XML    163K 
91: XML.R13     Stock-Based Compensation                             XML    117K 
56: XML.R14     Pension, Retiree Medical and Savings Plans           XML    436K 
59: XML.R15     Noncontrolled Bottling Affiliates                    XML    108K 
74: XML.R16     Debt Obligations and Commitments                     XML    113K 
113: XML.R17     Financial Instruments                                XML    148K  
48: XML.R18     Net Income Attributable to PepsiCo per Common        XML     95K 
                Share                                                            
21: XML.R19     Preferred Stock                                      XML     74K 
62: XML.R20     Accumulated Other Comprehensive Loss Attributable    XML     70K 
                to PepsiCo                                                       
89: XML.R21     Supplemental Financial Information                   XML    122K 
39: XML.R22     Acquisitions                                         XML    100K 
85: XML.R23     Our Significant Accounting Policies (Policy)         XML    125K 
60: XML.R24     Basis of Presentation and Our Divisions (Tables)     XML    247K 
107: XML.R25     Restructuring, Impairment and Integration Charges    XML    148K  
                (Tables)                                                         
93: XML.R26     Property, Plant and Equipment and Intangible         XML    221K 
                Assets (Tables)                                                  
66: XML.R27     Income Taxes (Tables)                                XML    178K 
75: XML.R28     Stock-Based Compensation (Tables)                    XML    129K 
26: XML.R29     Pension, Retiree Medical and Savings Plans           XML    481K 
                (Tables)                                                         
30: XML.R30     Noncontrolled Bottling Affiliates (Tables)           XML    100K 
42: XML.R31     Debt Obligations and Commitments (Tables)            XML    107K 
50: XML.R32     Financial Instruments (Tables)                       XML    131K 
73: XML.R33     Net Income Attributable to PepsiCo per Common        XML     93K 
                Share (Tables)                                                   
92: XML.R34     Preferred Stock (Tables)                             XML     72K 
24: XML.R35     Accumulated Other Comprehensive Loss Attributable    XML     68K 
                to PepsiCo (Tables)                                              
33: XML.R36     Supplemental Financial Information (Tables)          XML    130K 
98: XML.R37     Acquisitions (Tables)                                XML    132K 
106: XML.R38     Basis of Presentation and Our Divisions              XML    283K  
                (Narrative) (Details)                                            
67: XML.R39     Basis of Presentation and Our Divisions (Quarterly   XML    156K 
                Reporting Schedule) (Details)                                    
110: XML.R40     Basis of Presentation and Our Divisions (Net         XML   1.02M  
                Revenue and Operating Profit by Division)                        
                (Details)                                                        
34: XML.R41     Basis of Presentation and Our Divisions (Total       XML    768K 
                Assets and Capital Spending by Division) (Details)               
112: XML.R42     Basis of Presentation and Our Divisions              XML    548K  
                (Amortization of Intangible Assets and                           
                Depreciation and Other Amortization) (Details)                   
44: XML.R43     Basis of Presentation and Our Divisions (Net         XML    572K 
                Revenue and Long-Lived Assets) (Details)                         
22: XML.R44     Our Significant Accounting Policies (Narrative)      XML    268K 
                (Details)                                                        
43: XML.R45     Restructuring, Impairment and Integration Charges    XML    336K 
                (Narrative) (Details)                                            
88: XML.R46     Restructuring, Impairment and Integration Charges    XML    331K 
                (Merger and Integration Activity) (Details)                      
105: XML.R47     Restructuring, Impairment and Integration Charges    XML   1.22M  
                (Restructuring and Impairment Charges) (Details)                 
57: XML.R48     Restructuring, Impairment and Integration Charges    XML    621K 
                (Productivity for Growth Program Activity)                       
                (Details)                                                        
46: XML.R49     Property, Plant and Equipment and Intangible         XML     80K 
                Assets (Narrative) (Details)                                     
72: XML.R50     Property, Plant and Equipment and Intangible         XML    626K 
                Assets (Property, Plant and Equipment and                        
                Intangible Assets) (Details)                                     
25: XML.R51     Property, Plant and Equipment and Intangible         XML   1.72M 
                Assets (Change in Book Value of Nonamortizable                   
                Assets) (Details)                                                
77: XML.R52     Income Taxes (Narrative) (Details)                   XML    178K 
47: XML.R53     Income Taxes (Income Taxes) (Details)                XML    569K 
31: XML.R54     Income Taxes (Reserve Rollforward) (Details)         XML    129K 
104: XML.R55     Stock-Based Compensation (Narrative) (Details)       XML    420K  
100: XML.R56     Stock-Based Compensation (Table of                   XML    110K  
                Weighted-Average Black-Scholes Fair Value                        
                Assumptions) (Details)                                           
53: XML.R57     Stock-Based Compensation (Stock-Based Compensation   XML    164K 
                Activity ) (Details)                                             
38: XML.R58     Stock-Based Compensation (Restricted Stock Units     XML    208K 
                Activity) (Details)                                              
94: XML.R59     Stock-Based Compensation (Other Stock-Based          XML    123K 
                Compensation Data) (Details)                                     
29: XML.R60     Pension, Retiree Medical and Savings Plans           XML    432K 
                (Narrative) (Details)                                            
81: XML.R61     Pension, Retiree Medical and Savings Plans           XML   1.31M 
                (Selected Financial Information for Pension and                  
                Retiree Medical Plans) (Details)                                 
78: XML.R62     Pension, Retiree Medical and Savings Plans           XML    481K 
                (Components of Benefit Expense) (Details)                        
99: XML.R63     Pension, Retiree Medical and Savings Plans           XML    158K 
                (Estimated Amounts to be Amortized from                          
                Accumulated Other Comprehensive Loss into Benefit                
                Expense In 2011 for Pension and Retiree Medical                  
                Plans) (Details)                                                 
95: XML.R64     Pension, Retiree Medical and Savings Plans           XML    236K 
                (Weighted Average Assumptions to Determine                       
                Projected Benefit Liability and Benefit Expense                  
                for Pension and Retiree Medical Plans) (Details)                 
109: XML.R65     Pension, Retiree Medical and Savings Plans           XML    225K  
                (Selected Information about Plans with Liability                 
                for Service to Date and Total Benefit Liability in               
                Excess of Plan Assets) (Details)                                 
36: XML.R66     Pension, Retiree Medical and Savings Plans           XML    161K 
                (Estimated Future Benefit Payments ) (Details)                   
52: XML.R67     Pension, Retiree Medical and Savings Plans           XML   1.78M 
                (Categorized Plan Assets Measured at Fair Value)                 
                (Details)                                                        
70: XML.R68     Pension, Retiree Medical and Savings Plans           XML     75K 
                (Effects of One Percentage Point Change in the                   
                Assumed Health Care Trend Rate) (Details)                        
61: XML.R69     Noncontrolled Bottling Affiliates (Narrative)        XML    260K 
                (Details)                                                        
71: XML.R70     Noncontrolled Bottling Affiliates (Summarized        XML    456K 
                Financial Information) (Details)                                 
111: XML.R71     Noncontrolled Bottling Affiliates (Related Party     XML    215K  
                Transactions) (Details)                                          
37: XML.R72     Debt Obligations and Commitments (Narrative)         XML   1.22M 
                (Details)                                                        
45: XML.R73     Debt Obligations and Commitments (Debt Obligations   XML    576K 
                and Commitments) (Details)                                       
41: XML.R74     Debt Obligations and Commitments (Long-term          XML    843K 
                Contractual Commitments) (Details)                               
68: XML.R75     Financial Instruments (Narrative) (Details)          XML    370K 
76: XML.R76     Financial Instruments (Fair Values of financial      XML    444K 
                assets and liabilities) (Details)                                
65: XML.R77     Financial Instruments (Effective Portion of          XML    423K 
                Pre-Tax (Gains)/Losses on Derivative Instruments)                
                (Details)                                                        
58: XML.R78     Net Income Attributable to PepsiCo per Common        XML     87K 
                Share (Narrative) (Details)                                      
35: XML.R79     Net Income Attributable to PepsiCo per Common        XML    208K 
                Share (Basic and Diluted Net Income attributable                 
                to PepsiCo per common share) (Details)                           
23: XML.R80     Preferred Stock (Narrative) (Details)                XML    236K 
69: XML.R81     Preferred Stock (Schedule of Preferred Shares)       XML    307K 
                (Details)                                                        
51: XML.R82     Accumulated Other Comprehensive Loss Attributable    XML     76K 
                to PepsiCo (Narrative) (Details)                                 
64: XML.R83     Accumulated Other Comprehensive Loss Attributable    XML    172K 
                to PepsiCo (Accumulated Balances for Each                        
                Component of Other Comprehensive Loss Attributable               
                to PepsiCo) (Details)                                            
87: XML.R84     Supplemental Financial Information (Schedule of      XML    419K 
                Supplemental Balance Sheet Information) (Details)                
83: XML.R85     Supplemental Financial Information (Other            XML    169K 
                Supplemental Information) (Details)                              
49: XML.R86     Acquisitions (Narrative) (Details)                   XML    874K 
90: XML.R87     Acquisitions (Computation of Purchase Price)         XML    190K 
                (Details)                                                        
82: XML.R88     Acquisitions (Preliminary Estimates of the Fair      XML    155K 
                Value of Identifiable Assets Acquired and                        
                Liabilities Assumed) (Details)                                   
40: XML.R89     Acquisitions (Pro Forma Financial Information)       XML     83K 
                (Details)                                                        
102: EXCEL       IDEA Workbook of Financial Reports (.xls)            XLS   3.10M  
15: EX-101.INS  XBRL Instance -- pep-20101225                        XML   5.25M 
17: EX-101.CAL  XBRL Calculations -- pep-20101225_cal                XML    326K 
18: EX-101.DEF  XBRL Definitions -- pep-20101225_def                 XML   1.83M 
19: EX-101.LAB  XBRL Labels -- pep-20101225_lab                      XML   2.09M 
20: EX-101.PRE  XBRL Presentations -- pep-20101225_pre               XML   2.01M 
16: EX-101.SCH  XBRL Schema -- pep-20101225                          XSD    349K 
103: ZIP         XBRL Zipped Folder -- 0001193125-11-040427-xbrl      Zip    329K

‘XML.R23’ — Our Significant Accounting Policies (Policy)

This Financial Report is an XBRL XML File.

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<div> <div> Revenue Recognition We recognize revenue upon shipment or delivery to our customers based on written sales terms that do not allow for a right of return. However, our policy for DSD and certain chilled products is to remove and replace damaged and out-of-date products from store shelves to ensure that our consumers receive the product quality and freshness that they expect. Similarly, our policy for certain warehouse-distributed products is to replace damaged and out-of-date products. Based on our experience with this practice, we have reserved for anticipated damaged and out-of-date products. For additional unaudited information on our revenue recognition and related policies, including our policy on bad debts, see "Our Critical Accounting Policies" in Management's Discussion and Analysis of Financial Condition and Results of Operations. We are exposed to concentration of credit risk by our customers, including Wal-Mart. In 2010, Wal-Mart (including Sam's) represented approximately 12% of our total net revenue, including concentrate sales to our bottlers (including concentrate sales to PBG and PAS prior to the February 26, 2010 acquisition date) which are used in finished goods sold by them to Wal-Mart. We have not experienced credit issues with these customers.</div> </div>

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<NonNumericTextHeader> Revenue Recognition We recognize revenue upon shipment or delivery to our customers based on written sales terms that do not allow for a right of return. </NonNumericTextHeader>

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<div> <div class="MetaData"> Sales Incentives and Other Marketplace Spending We offer sales incentives and discounts through various programs to our customers and consumers. Sales incentives and discounts are accounted for as a reduction of revenue and totaled $29.1 billion in 2010, $12.9 billion in 2009 and $12.5 billion in 2008. While most of these incentive arrangements have terms of no more than one year, certain arrangements, such as fountain pouring rights, may extend beyond one year. Costs incurred to obtain these arrangements are recognized over the shorter of the economic or contractual life, as a reduction of revenue, and the remaining balances of $296 million, as of both December 25, 2010 and December 26, 2009, are included in current assets and other assets on our balance sheet. For additional unaudited information on our sales incentives, see "Our Critical Accounting Policies" in Management's Discussion and Analysis of Financial Condition and Results of Operations. Other marketplace spending, which includes the costs of advertising and other marketing activities, totaled $3.4 billion in 2010, $2.8 billion in 2009 and $2.9 billion in 2008 and is reported as selling, general and administrative expenses. Included in these amounts were advertising expenses of $1.9 billion in 2010 and $1.7 billion in both 2009 and 2008. Deferred advertising costs are not expensed until the year first used and consist of: <table style="border-collapse: collapse;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr><td width="6%"> </td> <td valign="top" width="3%" align="left">•</td> <td valign="top" width="1%"> </td> <td valign="top" align="left"> media and personal service prepayments; </td></tr></table> <table style="border-collapse: collapse;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr><td width="6%"> </td> <td valign="top" width="3%" align="left">•</td> <td valign="top" width="1%"> </td> <td valign="top" align="left"> promotional materials in inventory; and </td></tr></table> <table style="border-collapse: collapse;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr><td width="6%"> </td> <td valign="top" width="3%" align="left">•</td> <td valign="top" width="1%"> </td> <td valign="top" align="left"> production costs of future media advertising. </td></tr></table> Deferred advertising costs of $158 million and $143 million at year-end 2010 and 2009, respectively, are classified as prepaid expenses on our balance sheet. </div> </div>

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<div> <div class="MetaData"> Distribution Costs Distribution costs, including the costs of shipping and handling activities, are reported as selling, general and administrative expenses. Shipping and handling expenses were $7.7 billion in 2010 and $5.6 billion in both 2009 and 2008. </div> </div>

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<div> <div class="MetaData"> Cash Equivalents Cash equivalents are investments with original maturities of three months or less which we do not intend to rollover beyond three months. </div> </div>

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<ElementDefenition> A description of a company's cash and cash equivalents accounting policy. An entity shall disclose its policy for determining which items are treated as cash equivalents. Other information that may be disclosed includes (1) the nature of any restrictions on the entity's use of its cash and cash equivalents, (2) whether the entity's cash and cash equivalents are insured or expose the entity to credit risk, (3) the classification of any negative balance accounts (overdrafts), and (4) the carrying basis of cash equivalents (for example, at cost) and whether the carrying amount of cash equivalents approximates fair value. Cash includes currency on hand as well as demand deposits with banks or financial institutions. It also includes other kinds of accounts that have the general characteristics of demand deposits in that the customer may deposit additional funds at any time and also effectively may withdraw funds at any time without prior notice or penalty. In addition, cash equivalents include short-term, highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. Generally, only investments with original maturities of three months or less qualify under that definition. Original maturity means original maturity to the entity holding the investment. For example, both a three-month US Treasury bill and a three-year Treasury note purchased three months from maturity qualify as cash equivalents. However, a Treasury note purchased three-years ago does not become a cash equivalent when its remaining maturity is three months. For a bank, may include explanation and amount of requirement to maintain reserves against deposits. </ElementDefenition>

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<ElementName> pep_SoftwareCostsPolicyTextBlock </ElementName>

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<ShortDefinition> A description of the company's policy around capitalization of software costs </ShortDefinition>

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<div> <div class="MetaData"> Software Costs We capitalize certain computer software and software development costs incurred in connection with developing or obtaining computer software for internal use when both the preliminary project stage is completed and it is probable that the software will be used as intended. Capitalized software costs include only (i) external direct costs of materials and services utilized in developing or obtaining computer software, (ii) compensation and related benefits for employees who are directly associated with the software project and (iii) interest costs incurred while developing internal-use computer software. Capitalized software costs are included in property, plant and equipment on our balance sheet and amortized on a straight-line basis when placed into service over the estimated useful lives of the software, which approximate five to ten years. Software amortization totaled $137 million in 2010, $119 million in 2009 and $58 million in 2008. Net capitalized software and development costs were $1.1 billion as of both December 25, 2010 and December 26, 2009. </div> </div>

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<NonNumericTextHeader> Software Costs We capitalize certain computer software and software development costs incurred in connection with developing or obtaining computer software </NonNumericTextHeader>

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<div> <div class="MetaData"> Commitments and Contingencies We are subject to various claims and contingencies related to lawsuits, certain taxes and environmental matters, as well as commitments under contractual and other commercial obligations. We recognize liabilities for contingencies and commitments when a loss is probable and estimable. For additional information on our commitments, see Note 9. </div> </div>

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<NonNumericTextHeader> Commitments and Contingencies We are subject to various claims and contingencies related to lawsuits, certain taxes and environmental matters, as well as </NonNumericTextHeader>

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<div> <div class="MetaData"> Research and Development We engage in a variety of research and development activities. These activities principally involve the development of new products, improvement in the quality of existing products, improvement and modernization of production processes, and the development and implementation of new technologies to enhance the quality and value of both current and proposed product lines. Consumer research is excluded from research and development costs and included in other marketing costs. Research and development costs were $488 million in 2010, $414 million in 2009 and $388 million in 2008 and are reported within selling, general and administrative expenses. </div> </div>

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<NonNumericTextHeader> Research and Development We engage in a variety of research and development activities. These activities principally involve the development of new products, </NonNumericTextHeader>

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<ElementDefenition> Describes an entity's accounting policy for its research and development and computer software activities including the accounting treatment for costs incurred for (1) research and development activities, (2) development of computer software for internal use, (3) computer software to be sold, leased or otherwise marketed as a separate product or as part of a product or process and (4) in-process research and development acquired in a purchase business combination. </ElementDefenition>

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<div> <div class="MetaData"> Other Significant Accounting Policies Our other significant accounting policies are disclosed as follows: <table style="border-collapse: collapse;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr><td width="6%"> </td> <td valign="top" width="3%" align="left">•</td> <td valign="top" width="1%"> </td> <td valign="top" align="left"> Property, Plant and Equipment and Intangible Assets – Note 4, and for additional unaudited information on goodwill and other intangible assets, see "Our Critical Accounting Policies" in Management's Discussion and Analysis of Financial Condition and Results of Operations. </td></tr></table> <table style="border-collapse: collapse;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr><td width="6%"> </td> <td valign="top" width="3%" align="left">•</td> <td valign="top" width="1%"> </td> <td valign="top" align="left"> Income Taxes – Note 5, and for additional unaudited information, see "Our Critical Accounting Policies" in Management's Discussion and Analysis of Financial Condition and Results of Operations. </td></tr></table> <table style="border-collapse: collapse;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr><td width="6%"> </td> <td valign="top" width="3%" align="left">•</td> <td valign="top" width="1%"> </td> <td valign="top" align="left"> Stock-Based Compensation – Note 6. </td></tr></table> <table style="border-collapse: collapse;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr><td width="6%"> </td> <td valign="top" width="3%" align="left">•</td> <td valign="top" width="1%"> </td> <td valign="top" align="left"> Pension, Retiree Medical and Savings Plans – Note 7, and for additional unaudited information, see "Our Critical Accounting Policies" in Management's Discussion and Analysis of Financial Condition and Results of Operations. </td></tr></table> <table style="border-collapse: collapse;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr><td width="6%"> </td> <td valign="top" width="3%" align="left">•</td> <td valign="top" width="1%"> </td> <td valign="top" align="left"> Financial Instruments – Note 10, and for additional unaudited information, see "Our Business Risks" in Management's Discussion and Analysis of Financial Condition and Results of Operations. </td></tr></table></div> </div>

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<NonNumericTextHeader> Other Significant Accounting Policies Our other significant accounting policies are disclosed as follows: • Property, Plant </NonNumericTextHeader>

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<PerShareRoundingLevel> UnKnown </PerShareRoundingLevel>

<ExchangeRateRoundingLevel> UnKnown </ExchangeRateRoundingLevel>

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Filing Submission 0001193125-11-040427 – Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)

Pepsico Inc – ‘10-K’ for 12/25/10 – ‘XML.R23’

On: Friday, 2/18/11, at 4:57pm ET · For: 12/25/10 · Accession #: 1193125-11-40427 · File #: 1-01183

Previous ‘10-K’: ‘10-K’ on 2/22/10 for 12/26/09 · Next: ‘10-K’ on 2/27/12 for 12/31/11 · Latest: ‘10-K’ on 2/9/24 for 12/30/23

Annual Report — Form 10-K — Sect. 13 / 15(d) – SEA’34Filing Table of Contents

‘XML.R23’ — Our Significant Accounting Policies (Policy)

This Financial Report is an XBRL XML File.

Annual Report — Form 10-K — Sect. 13 / 15(d) – SEA’34
Filing Table of Contents