Debt (Tables)

12 Months Ended

Dec. 31, 2019

Debt Disclosure [Abstract]

Schedule of short-term borrowings

Short-term borrowings were as follows:

	December 31,
	2019		2018
Current maturities of long-term debt	$	1,049	$	961
Short-term debt and current portion of long-term debt	$	1,049	$	961

Schedule of long-term debt

Long-term debt was as follows:

					December 31,
	Stated Rate		Weighted Average Interest Rates at December 31, 2019(1)		2019			2018
Xerox
Senior Notes due 2019					$	—		$	406
Senior Notes due 2019					—			554
Senior Notes due 2020	2.80	%	2.50	%	313			313
Senior Notes due 2020	3.50	%	3.47	%	362			362
Senior Notes due 2020	2.75	%	2.67	%	376			375
Senior Notes due 2021	4.50	%	4.54	%	1,062			1,062
Senior Notes due 2022	4.07	%	4.07	%	300			300
Senior Notes due 2023(2)	4.13	%	3.68	%	1,000			1,000
Senior Notes due 2024	3.80	%	3.84	%	300			300
Senior Notes due 2035	4.80	%	4.84	%	250			250
Senior Notes due 2039	6.75	%	6.78	%	350			350
Subtotal - Notes					$	4,313		$	5,272
Capital lease obligations(3)					$	—		$	9
Principal debt balance					$	4,313		$	5,281
Unamortized discount					(16		)	(25		)
Debt issuance costs					(17		)	(25		)
Fair value adjustments(4)
Terminated swaps					1			2
Current swaps					1			(3		)
Less: current maturities					(1,049		)	(961		)
Total Long-term Debt					$	3,233		$	4,269

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(1) Represents the weighted average effective interest rate, which includes the effect of discounts and premiums on issued debt.

(2) As a result of the downgrade of our debt ratings in December 2018, the original coupon rate of 3.625% increased by 0.50% to 4.125% effective March 15, 2019.

(3) As a result of the adoption of ASC 842, Leases effective January 1, 2019, capital lease obligations are reported in Other current and non-current liabilities. Refer to Note 1 - Basis of Presentation and Summary of Significant Accounting Policies, Note 2 - Adoption of New Leasing Standard - Lessee and Note 15 - Supplementary Financial Information for additional information.

(4) Fair value adjustments include the following: (i) fair value adjustments to debt associated with terminated interest rate swaps, which are being amortized to interest expense over the remaining term of the related notes; and (ii) changes in fair value of hedged debt obligations attributable to movements in benchmark interest rates. Hedge accounting requires hedged debt instruments to be reported inclusive of any fair value adjustment.

Schedule of maturities of long-term debt

Scheduled principal payments due on our long-term debt for the next five years and thereafter are as follows:

2020(1)		2021		2022		2023		2024		Thereafter		Total
$	1,051	$	1,062	$	300	$	1,000	$	300	$	600	$	4,313

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(1) Long-term debt maturities for 2020 are $0, $313, $738 and $0 for the first, second, third and fourth quarters, respectively.

Interest income and interest expense disclosure

Interest expense and interest income was as follows:

	Year Ended December 31,
	2019		2018		2017
Interest expense(1)	$	236	$	244	$	252
Interest income(2)	260		283		302

_____________

(1) Includes Equipment financing interest expense, as well as non-financing interest expense included in Other expenses, net in the Consolidated Statements of Income.

(2)

Includes Finance income, as well as other interest income that is included in Other expenses, net in the Consolidated Statements of Income.