CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS

Cash equivalents consist of instruments with remaining maturities of three months or less at the date of purchase. We classify all of our cash equivalents and short-term investments as “available-for-sale.” In general, these investments are free of trading restrictions. We carry these investments at fair value, based on quoted market prices or other readily available market information. Unrealized gains and losses, net of taxes, are included in accumulated other comprehensive income, which is reflected as a separate component of stockholders’ equity in our Condensed Consolidated Balance Sheets. Gains and losses are recognized when realized in our Condensed Consolidated Statements of Income. When we have determined that an other-than-temporary decline in fair value has occurred, the amount of the decline that is related to a credit loss is recognized in income. Gains and losses are determined using the specific identification method.

Cash, cash equivalents and short-term investments consisted of the following as of June 3, 2011 (in thousands):



	Amortized Cost		Unrealized Gains		Unrealized Losses			Estimated Fair Value
Current assets:
Cash	$	181,036	$	—	$	—		$	181,036
Cash equivalents:
Commercial paper	28,044		—		—			28,044
Money market mutual funds and repurchase agreements	576,878		—		—			576,878
Municipal securities	601		—		—			601
Time deposits	40,916		—		—			40,916
Total cash equivalents	646,439		—		—			646,439
Total cash and cash equivalents	827,475		—		—			827,475
Short-term fixed income securities:
Corporate bonds and commercial paper	1,038,924		9,263		(269		)	1,047,918
Foreign government securities	16,443		137		—			16,580
Municipal securities	118,453		198		(18		)	118,633
U.S. agency securities	214,279		1,424		—			215,703
U.S. Treasury securities	383,913		2,189		(1		)	386,101
Subtotal	1,772,012		13,211		(288		)	1,784,935
Marketable equity securities	10,778		2,332		—			13,110
Total short-term investments	1,782,790		15,543		(288		)	1,798,045
Total cash, cash equivalents and short-term investments	$	2,610,265	$	15,543	$	(288	)	$	2,625,520

Cash, cash equivalents and short-term investments consisted of the following as of December 3, 2010 (in thousands):



	Amortized Cost		Unrealized Gains		Unrealized Losses			Estimated Fair Value
Current assets:
Cash	$	98,691	$	—	$	—		$	98,691
Cash equivalents:
Commercial paper	41,389		—		—			41,389
Money market mutual funds and repurchase agreements	477,259		—		—			477,259
Municipal securities	350		—		—			350
Time deposits	64,006		—		—			64,006
U.S. Treasury securities	68,195		1		—			68,196
Total cash equivalents	651,199		1		—			651,200
Total cash and cash equivalents	749,890		1		—			749,891
Short-term fixed income securities:
Corporate bonds and commercial paper	977,889		8,079		(1,450		)	984,518
Foreign government securities	33,079		309		(2		)	33,386
Municipal securities	119,608		29		(32		)	119,605
U.S. agency securities	229,772		778		(179		)	230,371
U.S. Treasury securities	336,441		2,828		(209		)	339,060
Subtotal	1,696,789		12,023		(1,872		)	1,706,940
Marketable equity securities	11,196		1,122		(1,134		)	11,184
Total short-term investments	1,707,985		13,145		(3,006		)	1,718,124
Total cash, cash equivalents and short-term investments	$	2,457,875	$	13,146	$	(3,006	)	$	2,468,015

See Note 4 for further information regarding the fair value of our financial instruments.

The following table summarizes the fair value and gross unrealized losses related to available-for-sale securities, aggregated by investment category, that have been in a continuous unrealized loss position for less than twelve months, as of June 3, 2011 and December 3, 2010 (in thousands):



	2011					2010
	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
Corporate bonds and commercial paper	$	96,582	$	(269	)	$	257,615	$	(1,450	)
Foreign government securities	—		—			4,531		(2		)
Marketable equity securities	—		—			9,380		(1,134		)
Municipal securities	20,172		(18		)	43,028		(32		)
U.S. Treasury and agency securities	6,533		(1		)	192,702		(388		)
Total	$	123,287	$	(288	)	$	507,256	$	(3,006	)

As of June 3, 2011 and December 3, 2010, there were no securities in a continuous unrealized loss position for more than twelve months. There were 63 securities and 168 securities that were in an unrealized loss position at June 3, 2011 and at December 3, 2010, respectively.

The following table summarizes the cost and estimated fair value of short-term fixed income securities classified as short-term investments based on stated effective maturities as of June 3, 2011 (in thousands):



	Amortized Cost		Estimated Fair Value
Due within one year	$	776,046	$	778,874
Due within two years	558,841		563,185
Due within three years	376,128		381,038
Due after three years	60,997		61,838
Total	$	1,772,012	$	1,784,935

We review our debt and marketable equity securities classified as short-term investments on a regular basis to evaluate whether or not any security has experienced an other-than-temporary decline in fair value. We consider factors such as the length of time and extent to which the market value has been less than the cost, the financial condition and near-term prospects of the issuer and our intent to sell, or whether it is more likely than not we will be required to sell, the investment before recovery of the investment's amortized cost basis. If we believe that an other-than-temporary decline exists in one of these securities, we write down these investments to fair value. For debt securities, the portion of the write-down related to credit loss would be recorded to interest and other income, net in our Condensed Consolidated Statements of Income. Any portion not related to credit loss would be recorded to accumulated other comprehensive income, which is reflected as a separate component of stockholders’ equity in our Condensed Consolidated Balance Sheets. For equity securities, the write-down would be recorded to investment gains (losses), net in our Condensed Consolidated Statements of Income. As of June 3, 2011, we did not record any other-than-temporary impairment losses associated with our debt and marketable equity securities.