Commitments and Contingencies

12 Months Ended

Jul. 03, 2015

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Note 4. Commitments and Contingencies

Lease Commitments

The Company leases certain facilities and equipment under long-term, non-cancelable operating leases. The Company’s operating leases consist of leased property and equipment that expire at various dates through 2025. Rental expense under these operating leases, including month-to-month rentals, was $60 million, $59 million and $64 million in 2015, 2014 and 2013, respectively. Future minimum lease payments under operating leases that have initial or remaining non-cancelable lease terms in excess of one year at July 3, 2015 are as follows (in millions):

2016	$	40
2017	32
2018	26
2019	23
2020	19
Thereafter	45
Total future minimum payments	$	185

Product Warranty Liability

Changes in the warranty accrual for 2015, 2014 and 2013 were as follows (in millions):

	2015			2014			2013
Warranty accrual, beginning of period	$	182		$	187		$	260
Warranty liabilities assumed as a result of acquisitions	1			4			—
Charges to operations	187			170			178
Utilization	(190		)	(207		)	(221		)
Changes in estimate related to pre-existing warranties	41			28			(30		)
Warranty accrual, end of period	$	221		$	182		$	187

Accrued warranty also includes amounts classified in other liabilities in the consolidated balance sheets of $71 million at July 3, 2015 and $63 million at June 27, 2014.

Long-term Purchase Agreements

The Company has entered into long-term purchase agreements with various component suppliers. The commitments depend on specific products ordered and may be subject to minimum quality requirements and future price negotiations. The Company expects these commitments to total $117 million for 2016, $15 million for 2017, $5 million for 2018, $3 million for 2019 and no remaining commitments for 2020.