POSTRETIREMENT BENEFIT PLANS

6 Months Ended

Jun. 28, 2020

Retirement Benefits [Abstract]

POSTRETIREMENT BENEFIT PLANS

POSTRETIREMENT BENEFIT PLANS

Our pretax net periodic benefit (income) cost related to our qualified defined benefit pension plans and retiree medical and life insurance plans consisted of the following (in millions):

	Quarters Ended				Six Months Ended
	June 28, 2020		June 30, 2019		June 28, 2020		June 30, 2019
Qualified defined benefit pension plans
Service cost	$	26	$	129	$	51	$	258
Interest cost	384		451		769		903
Expected return on plan assets	(566)		(575)		(1132)		(1,150)
Recognized net actuarial losses	212		351		424		702
Amortization of prior service credits	(85)		(83)		(171)		(167)
Total net periodic benefit (income) cost	$	(29)	$	273	$	(59)	$	546
Retiree medical and life insurance plans
Service cost	$	4	$	3	$	7	$	7
Interest cost	17		24		35		48
Expected return on plan assets	(32)		(27)		(64)		(55)
Recognized net actuarial losses	(1)		—		(2)		1
Amortization of prior service costs	9		11		19		21
Total net periodic benefit (income) cost	$	(3)	$	11	$	(5)	$	22

As previously announced on July 1, 2014, we completed the final step of the planned freeze of our qualified and nonqualified defined benefit pension plans for salaried employees effective January 1, 2020; the plans are now fully frozen. With the freeze complete, the majority of our salaried employees participate in an enhanced defined contribution retirement savings plan.

We record the service cost component of net periodic benefit cost (for our bargained plans beginning in 2020) as part of cost of sales and the non-service cost components of net periodic benefit cost as part of other non-operating income (expense), net in the consolidated statements of earnings.

The recognized net actuarial losses and amortization of prior service credits or costs in the table above, along with similar costs related to our other postretirement benefit plans ($5 million and $10 million for the quarter and six months ended June 28, 2020, and $9 million and $20 million for the quarter and six months ended June 30, 2019) were reclassified from accumulated other comprehensive loss (AOCL) and recorded as a component of net periodic benefit (income) cost for the periods presented. These costs totaled $140 million ($110 million, net of tax) and $280 million ($220 million, net of tax) during the quarter and six months ended June 28, 2020, and $288 million ($227 million, net of tax) and $577 million ($454 million, net of tax) during the quarter and six months ended June 30, 2019 and were recorded on our consolidated statements of comprehensive income as an increase to other comprehensive income.

The required funding of our qualified defined benefit pension plans is determined in accordance with the Employee Retirement Income Security Act of 1974 (ERISA), as amended by the Pension Protection Act of 2006 (PPA), along with consideration of CAS and Internal Revenue Code rules. There were no contributions to our qualified defined benefit pension plans during the quarters and six months ended June 28, 2020 and June 30, 2019.