Employee Benefit Plans

Pension and Postretirement Plans. We sponsor both funded and unfunded domestic and foreign defined pension and other postretirement benefit plans, and defined contribution plans.

In March 2017, the FASB issued ASU 2017-07, Compensation-Retirement Benefits (Topic 715), Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. This ASU requires an employer to report the service cost component of net periodic pension benefit cost in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period, with other cost components presented separately from the service cost component and outside of income from operations. This ASU also allows only the service cost component of net periodic pension benefit cost to be eligible for capitalization when applicable. This ASU was effective for years beginning after December 15, 2017. The Company adopted this standard on January 1, 2018 applying the presentation requirements retrospectively. We elected to apply the practical expedient, which allows us to reclassify amounts disclosed previously in the employee benefit plans note as the basis for applying retrospective presentation for comparative periods as it is impracticable to determine the disaggregation of the cost components for amounts capitalized and amortized in those periods. Provisions related to presentation of the service cost component eligibility for capitalization were applied prospectively.

The effect of the retrospective presentation change related to the net periodic benefit cost of our defined benefit pension and postretirement plans on our condensed consolidated statement of operations was as follows (in millions):



	Quarter Ended March 31, 2017
(dollars in millions)	Previously Reported		Effect of Change Higher/(Lower)			As Revised
Cost of product sold	$	7,263	$	48		$	7,311
Cost of services sold	2,814		11			2,825
Research and development	577		9			586
Selling, general and administrative	1,482		55			1,537
Other income	588		—			588
Non-service pension (benefit)	—		(123		)	(123		)

Contributions to our plans were as follows:



	Quarter Ended March 31,
(dollars in millions)	2018		2017
Defined benefit plans	$	37	$	46
Defined contribution plans	94		90

There were no contributions to our domestic defined benefit pension plans in the quarters ended March 31, 2018 and 2017. The following table illustrates the components of net periodic benefit cost for our defined pension and other postretirement benefit plans:



	Pension Benefits Quarter Ended March 31,						Other Postretirement Benefits Quarter Ended March 31,
(dollars in millions)	2018			2017			2018			2017
Service cost	$	93		$	93		$	1		$	1
Interest cost	279			278			6			7
Expected return on plan assets	(563		)	(540		)	—			—
Amortization of prior service credit	(10		)	(9		)	(1		)	—
Recognized actuarial net loss (gain)	101			143			(2		)	(3		)
Net settlement and curtailment (gain) loss	(1		)	1			—			—
Total net periodic benefit (income) cost	$	(101	)	$	(34	)	$	4		$	5

As approved in 2016, effective January 1, 2017, a voluntary lump-sum option is available for the frozen final average earnings benefits of certain U.S. salaried employees upon termination of employment after 2016. This option provides participants with the choice of electing to receive a lump-sum payment in lieu of receiving a future monthly pension benefit. This plan change reduced the projected benefit obligation by $170 million as of December 31, 2016.