Fair Value Of Financial Instruments

3 Months Ended

Apr. 01, 2012

Fair Value Of Financial Instruments [Abstract]

Fair Value Of Financial Instruments

D. FAIR VALUE OF FINANCIAL INSTRUMENTS

Our financial instruments include cash and equivalents, marketable securities and other investments; accounts receivable and accounts payable; short- and long-term debt; and derivative financial instruments. We did not have any significant non-financial assets or liabilities measured at fair value on December 31, 2011, or April 1, 2012.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market in an orderly transaction between marketplace participants. Various valuation approaches can be used to determine fair value, each requiring different valuation inputs. The following hierarchy classifies the inputs used to determine fair value into three levels:

• Level 1 – quoted prices in active markets for identical assets or liabilities;

• Level 2 – inputs, other than quoted prices, observable by a marketplace participant either directly or indirectly; and

• Level 3 – unobservable inputs significant to the fair value measurement.

The carrying values of cash and equivalents, accounts receivable and payable, and short-term debt (commercial paper) on the Consolidated Balance Sheets approximate their fair value. The following tables present the fair values of our other financial assets and liabilities on December 31, 2011, and April 1, 2012, and the basis for determining their fair values:

	Carrying Value			Fair Value			Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2) (b)
Financial assets (liabilities) (a)	December 31, 2011
Marketable securities:
Available-for-sale	$	70		$	70		$	8	$	62
Held-to-maturity		178			175			—		175
Other investments		145			145			89		56
Derivatives		34			34			—		34
Long-term debt, including current portion		(3,930	)		(4,199	)		—		(4,199	)

	April 1, 2012
Marketable securities:
Available-for-sale	$	70		$	70		$	14	$	56
Held-to-maturity		299			299			—		299
Other investments		148			148			86		62
Derivatives		65			65			—		65
Long-term debt, including current portion		(3,908	)		(4,153	)		—		(4,153	)

(a) We had no Level 3 financial instruments on December 31, 2011, or April 1, 2012.

(b) Determined under a market approach using valuation models that incorporate observable inputs such as interest rates, bond yields and quoted prices for similar assets and liabilities.