Sprint - Nextel 2010 Annual Report Download - page 72

Note 4. Financial Instruments
Cash and cash equivalents, accounts and notes receivable, and accounts payable are carried at cost, which
approximates fair value. Our short-term investments (consisting primarily of time deposits and treasury securities), totaling
$300 million and $105 million as of December 31, 2010 and 2009, respectively, are recorded at amortized cost, and the
respective carrying amounts approximate fair value. The fair value of our marketable equity securities totaling $39 million and
$43 million as of December 31, 2010 and 2009, respectively, is measured on a recurring basis using quoted prices in active
markets.
The estimated fair value of long-term debt, financing and capital lease obligations, including current maturities is
based on current market prices or interest rates. The following table presents carrying amounts and estimated fair values of our
current and long-term debt, financing and capital lease obligations:
Current and long-term debt, financing and capital lease obligations
December 31,
2010
Carrying
Amount
(in millions)
$ 20,191
Estimated
Fair Value
$ 20,007
2009
Carrying
Amount
$ 21,061
Estimated
Fair Value
$ 20,014
Note 5. Property, Plant and Equipment
Property, plant and equipment consist primarily of network equipment and other long-lived assets used to provide
service to our subscribers. Changes in technology or in our intended use of these assets, including our ability to successfully
test and deploy our network modernization plan, Network Vision, as well as changes in economic or industry factors or in our
business or prospects, may cause the estimated period of use or the value of these assets to change.
Network equipment, site costs and related software includes switching equipment, cell site towers, site development
costs, radio frequency equipment, network software, digital fiber optic cable, transport facilities and transmission-related
equipment. Buildings and improvements principally consists of owned general office facilities, retail stores and leasehold
improvements. Non-network internal use software, office equipment and other primarily consists of furniture, information
technology systems and equipment and vehicles. Construction in progress, which is not depreciated until placed in service,
primarily includes materials, transmission and related equipment, labor, engineering, site development costs, interest and other
costs relating to the construction and development of our network. Interest capitalized in connection with the construction of
long-lived assets totaled $13 million, $12 million and $123 million for the years ended December 31, 2010, 2009 and 2008,
respectively.
The components of property, plant and equipment, and the related accumulated depreciation were as follows:
Land
Network equipment, site costs and related software
Buildings and improvements
Non-network internal use software, office equipment and other
Construction in progress
Less accumulated depreciation
Property, plant and equipment, net
December 31,
2010
(in millions)
$ 332
37,514
4,823
2,465
995
(30,915)
$ 15,214
December 31,
2009
$ 332
36,992
4,792
2,966
1,111
(27,913)
$ 18,280
Table of Contents SPRINT NEXTEL CORPORATION
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
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