Equity

6 Months Ended

Jun. 30, 2012

Stockholders' Equity Note [Abstract]

EQUITY

EQUITY

The changes in Shareholders’ equity follow:

	Eaton shareholders’ equity			Noncontrolling interests			Total equity
Balance at December 31, 2011	$	7,469		$	23		$	7,492
Net income	693			—			693
Other comprehensive loss	(16		)	—			(16		)
Cash dividends paid	(255		)	(2		)	(257		)
Issuance of shares under equity-based compensation plans-net	46			—			46
Balance at June 30, 2012	$	7,937		$	21		$	7,958

Net Income per Common Share

A summary of the calculation of net income per common share attributable to common shareholders follows:

	Three months ended June 30				Six months ended June 30
(Shares in millions)	2012		2011		2012		2011
Net income attributable to Eaton common shareholders	$	382	$	336	$	693	$	623
Weighted-average number of common shares outstanding-diluted	339.5		345.7		339.6		345.7
Less dilutive effect of stock options and restricted stock awards	2.5		4.8		3.4		5.2
Weighted-average number of common shares outstanding-basic	337.0		340.9		336.2		340.5
Net income per common share
Diluted	$	1.12	$	0.97	$	2.04	$	1.80
Basic	1.13		0.99		2.06		1.83

For the second quarter and first six months of 2012, 2.4 million and 1.7 million stock options, respectively, were excluded from the calculation of diluted net income per common share because the exercise price of the options exceeded the average market price of the common shares during the period and their effect, accordingly, would have been antidilutive. For the second quarter and first six months of 2011, 0.5 million and 0.3 million stock options, respectively, were excluded from the calculation of diluted net income per common share because the exercise price of the options exceeded the average market price of the common shares during the period and their effect, accordingly, would have been antidilutive.