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v3.23.2

Revenue Recognition Accounting Policy | 6 Months Ended
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Jun. 30, 2023
Revenue Recognition and Deferred Revenue [Abstract] |
Revenue Recognition | Revenue Recognition Disaggregation of Total Revenues The following tables disaggregate revenue by Concept, for our two most significant markets based on Operating Profit and for all other markets. We believe this disaggregation best reflects the extent to which the nature, amount, timing and uncertainty of our revenues and cash flows are impacted by economic factors.
| Quarter ended 6/30/2023
|  | KFC Division |  | Taco Bell Division |  | Pizza Hut Division |  | Habit Burger Grill Division |  | Total
U.S. |  |  |  |  |  |  |  |  |  |
Company sales |  | $ | 17 |  |  | $ | 253 |  |  | $ | 4 |  |  | $ | 139 |  |  | $ | 413 |
Franchise revenues |  | 49 |  |  | 194 |  |  | 66 |  |  | 2 |  |  | 311 |
Property revenues |  | 3 |  |  | 10 |  |  | 1 |  |  | — |  |  | 14 |
Franchise contributions for advertising and other services |  | 8 |  |  | 148 |  |  | 74 |  |  | 1 |  |  | 231 |
China |  |  |  |  |  |  |  |  |  |
Franchise revenues |  | 61 |  |  | — |  |  | 16 |  |  | — |  |  | 77 |
Other |  |  |  |  |  |  |  |  |  |
Company sales |  | 98 |  |  | — |  |  | — |  |  | — |  |  | 98 |
Franchise revenues |  | 290 |  |  | 14 |  |  | 65 |  |  | — |  |  | 369 |
Property revenues |  | 13 |  |  | — |  |  | 1 |  |  | — |  |  | 14 |
Franchise contributions for advertising and other services |  | 143 |  |  | 2 |  |  | 15 |  |  | — |  |  | 160 |
|  | $ | 682 |  |  | $ | 621 |  |  | $ | 242 |  |  | $ | 142 |  |  | $ | 1,687 |
|  | Quarter ended 6/30/2022
|  | KFC Division |  | Taco Bell Division |  | Pizza Hut Division |  | Habit Burger Grill Division |  | Total
U.S. |  |  |  |  |  |  |  |  |  |
Company sales |  | $ | 16 |  |  | $ | 243 |  |  | $ | 5 |  |  | $ | 136 |  |  | $ | 400 |
Franchise revenues |  | 47 |  |  | 178 |  |  | 64 |  |  | 2 |  |  | 291 |
Property revenues |  | 3 |  |  | 10 |  |  | 1 |  |  | — |  |  | 14 |
Franchise contributions for advertising and other services |  | 7 |  |  | 142 |  |  | 72 |  |  | — |  |  | 221 |
China |  |  |  |  |  |  |  |  |  |
Franchise revenues |  | 48 |  |  | — |  |  | 13 |  |  | — |  |  | 61 |
Other |  |  |  |  |  |  |  |  |  |
Company sales |  | 99 |  |  | — |  |  | — |  |  | — |  |  | 99 |
Franchise revenues |  | 283 |  |  | 11 |  |  | 63 |  |  | — |  |  | 357 |
Property revenues |  | 13 |  |  | — |  |  | 1 |  |  | — |  |  | 14 |
Franchise contributions for advertising and other services |  | 161 |  |  | 2 |  |  | 16 |  |  | — |  |  | 179 |
|  | $ | 677 |  |  | $ | 586 |  |  | $ | 235 |  |  | $ | 138 |  |  | $ | 1,636 |
| Year to date 6/30/2023
|  | KFC Division |  | Taco Bell Division |  | Pizza Hut Division |  | Habit Burger Grill Division |  | Total
U.S. |  |  |  |  |  |  |  |  |  |
Company sales |  | $ | 33 |  |  | $ | 482 |  |  | $ | 9 |  |  | $ | 269 |  |  | $ | 793 |
Franchise revenues |  | 95 |  |  | 372 |  |  | 136 |  |  | 3 |  |  | 606 |
Property revenues |  | 6 |  |  | 20 |  |  | 2 |  |  | 1 |  |  | 29 |
Franchise contributions for advertising and other services |  | 16 |  |  | 288 |  |  | 152 |  |  | 1 |  |  | 457 |
China |  |  |  |  |  |  |  |  |  |
Franchise revenues |  | 127 |  |  | — |  |  | 34 |  |  | — |  |  | 161 |
Other |  |  |  |  |  |  |  |  |  |
Company sales |  | 192 |  |  | — |  |  | — |  |  | — |  |  | 192 |
Franchise revenues |  | 574 |  |  | 27 |  |  | 131 |  |  | — |  |  | 732 |
Property revenues |  | 26 |  |  | — |  |  | 1 |  |  | — |  |  | 27 |
Franchise contributions for advertising and other services |  | 300 |  |  | 4 |  |  | 31 |  |  | — |  |  | 335 |
|  | $ | 1,369 |  |  | $ | 1,193 |  |  | $ | 496 |  |  | $ | 274 |  |  | $ | 3,332 |
| Year to date 6/30/2022
|  | KFC Division |  | Taco Bell Division |  | Pizza Hut Division |  | Habit Burger Grill Division |  | Total
U.S. |  |  |  |  |  |  |  |  |  |
Company sales |  | $ | 31 |  |  | $ | 457 |  |  | $ | 10 |  |  | $ | 261 |  |  | $ | 759 |
Franchise revenues |  | 92 |  |  | 335 |  |  | 128 |  |  | 3 |  |  | 558 |
Property revenues |  | 6 |  |  | 21 |  |  | 2 |  |  | — |  |  | 29 |
Franchise contributions for advertising and other services |  | 13 |  |  | 265 |  |  | 144 |  |  | — |  |  | 422 |
China |  |  |  |  |  |  |  |  |  |
Franchise revenues |  | 109 |  |  | — |  |  | 29 |  |  | — |  |  | 138 |
Other |  |  |  |  |  |  |  |  |  |
Company sales |  | 210 |  |  | — |  |  | — |  |  | — |  |  | 210 |
Franchise revenues |  | 543 |  |  | 22 |  |  | 133 |  |  | — |  |  | 698 |
Property revenues |  | 27 |  |  | — |  |  | 1 |  |  | — |  |  | 28 |
Franchise contributions for advertising and other services |  | 306 |  |  | 3 |  |  | 32 |  |  | — |  |  | 341 |
|  | $ | 1,337 |  |  | $ | 1,103 |  |  | $ | 479 |  |  | $ | 264 |  |  | $ | 3,183 |
Contract Liabilities Our contract liabilities are comprised of unamortized upfront fees received from franchisees and are presented within Accounts payable and other current liabilities and Other liabilities and deferred credits in our Condensed Consolidated Balance Sheets. A summary of significant changes to the contract liability balance during 2023 is presented below.
|  | Deferred Franchise Fees
Balance at December 31, 2022 |  | $ | 434 |
Revenue recognized that was included in unamortized upfront fees received from franchisees at the beginning of the period |  | (43) |
Increase for upfront fees associated with contracts that became effective during the period, net of amounts recognized as revenue during the period |  | 37 |
Other(a) |  | (9) |
Balance at June 30, 2023 |  | $ | 419 |
(a) Includes impact of foreign currency translation as well as the recognition of deferred franchise fees into Refranchising (gain) loss upon the termination of existing franchise agreements when entering into master franchise agreements. We expect to recognize contract liabilities as revenue over the remaining term of the associated franchise agreement as follows:
Less than 1 year | $ | 69 |  |
1 - 2 years | 63 |  |
2 - 3 years | 57 |  |
3 - 4 years | 50 |  |
4 - 5 years | 43 |  |
Thereafter | 137 |  |
Total | $ | 419 |  |

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