Stock-Based Compensation (Tables)

9 Months Ended

Sep. 30, 2014

Stock-Based Compensation

Stock-Based Compensation Expense

Stock-Based Compensation Expense
	Three months ended				Nine months ended
	September 30,				September 30,
(Millions)	2014		2013		2014		2013
Cost of sales	$	9	$	5	$	42	$	23
Selling, general and administrative expenses	31		36		143		149
Research, development and related expenses	7		6		36		25
Stock-based compensation expenses	$	47	$	47	$	221	$	197
Income tax benefits	$	(14)	$	(14)	$	(67)	$	(59)
Stock-based compensation expenses, net of tax	$	33	$	33	$	154	$	138

Stock Option Activity

The following table summarizes stock option activity during the nine months ended September 30, 2014:
Stock Option Program
			Number of Options	Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (months)	Aggregate Intrinsic Value (millions)
Under option —
	January 1		43,938,778	$	83.84
	Granted:
		Annual	5,736,183		126.77
	Exercised		(7,765,197)		82.63
	Canceled		(189,110)		104.46
	September 30		41,720,654	$	89.88	66	$	2,161
Options exercisable
	September 30		29,955,673	$	81.43	51	$	1,805

Stock Option Assumptions

	Annual
Stock Option Assumptions	2014
Exercise price	$	126.72
Risk-free interest rate		1.9	%
Dividend yield		2.6	%
Expected volatility		20.8	%
Expected life (months)		75
Black-Scholes fair value	$	19.63

Restricted Stock Units and Restricted Stock Activity

Restricted Stock Units and Restricted Stock
					Weighted Average
Restricted Stock Units and				Number of	Grant Date
Restricted Stock				Awards	Fair Value
Nonvested balance —
	As of January 1			3,105,361	$	92.31
		Granted:
			Annual	798,615		126.79
			Other	27,668		142.83
		Vested		(1,091,410)		90.43
		Forfeited		(51,287)		98.21
	As of September 30			2,788,947	$	103.31

Performance Shares Activity

				Weighted Average
			Number of	Grant Date
Performance Shares			Awards	Fair Value
Undistributed balance —
	As of January 1		895,635	$	88.12
		Granted	298,898		124.41
		Distributed	(277,357)		84.74
		Performance change	65,653		110.72
		Forfeited	(33,679)		109.31
	As of September 30		949,150	$	101.34