Commitments and Contingencies

12 Months Ended

Jul. 01, 2011

Commitments, Contingencies and Legal Proceedings [Abstract]

Commitments and Contingencies

Note 4.  Commitments and Contingencies

Lease Commitments

The Company leases certain facilities and equipment under long-term, non-cancelable operating leases. The Company’s operating leases consist of leased property and expire at various dates through 2020. Rental expense under these operating leases, including month-to-month rentals, was $23 million, $22 million and $21 million in 2011, 2010 and 2009, respectively. Future minimum lease payments under operating leases that have initial or remaining non-cancelable lease terms in excess of one year at July 1, 2011 are as follows (in millions):

2012	$	18
2013		17
2014		14
2015		11
2016		9
Thereafter		46
Total future minimum payments	$	115

Product Warranty Liability

Changes in the warranty accrual for 2011, 2010 and 2009 were as follows (in millions):

	2011			2010			2009
Warranty accrual, beginning of period	$	170		$	123		$	114
Charges to operations		172			183			126
Utilization		(160	)		(138	)		(111	)
Changes in estimate related to pre-existing warranties		(12	)		2			(6	)
Warranty accrual, end of period	$	170		$	170		$	123

Accrued warranty also includes amounts classified in other liabilities in the consolidated balance sheets of $38 million at July 1, 2011 and $41 million at July 2, 2010.

Long-term Purchase Agreements

The Company has entered into long-term purchase agreements with various component suppliers. The commitments depend on specific products ordered and may be subject to minimum quality requirements and future price negotiations. The Company expects these commitments to total $636 million for 2012, $6 million for 2013 and 2014, $5 million for 2015, and $1 million for 2016.