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Fair Value Measurements (Tables)
 12 Months Ended
Dec. 31, 2017
Fair Value Disclosures [Abstract]  
Summary of Designated Derivatives
The following table is a summary of the activity related to derivatives designated as cash flow hedges for the fiscal years ended December 31, 2017 and January 1, 2017:

(Dollars in Millions)
 
Gain/(Loss)
Recognized In Accumulated OCI(1)
 
Gain/(Loss) Reclassified From
Accumulated OCI Into Income(1)
 
Gain/(Loss) Recognized In
Other Income/Expense(2)
Cash Flow Hedges by Income Statement Caption
 
2017
 
2016
 
2017
 
2016
 
2017
 
2016
Sales to customers (3)
 
$
49

 
(65
)
 
(31
)
 
(47
)
 
(1
)
 
(1
)
Cost of products sold (3)
 
96

 
(212
)
 
(159
)
 
(3
)
 
(10
)
 
(15
)
Research and development expense (3)
 
(199
)
 
(76
)
 
(165
)
 
(90
)
 
5

 
—

Interest (income)/Interest expense, net (4)
 
110

 
66

 
83

 
37

 
—

 
—

Other (income) expense, net (3) (5)
 
(60
)
 
(72
)
 
(87
)
 
(7
)
 
—

 
2

Total
 
$
(4
)
 
(359
)
 
(359
)
 
(110
)
 
(6
)
 
(14
)
All amounts shown in the table above are net of tax.
(1) 
Effective portion
(2) 
Ineffective portion
(3) 
Forward foreign exchange contracts
(4) 
Cross currency interest rate swaps  
(5) 
Includes equity collar contracts
Financial Assets and Liabilities at Fair Value
The Company’s significant financial assets and liabilities measured at fair value as of December 31, 2017 and January 1, 2017 were as follows:
 
 
2017
 
2016
(Dollars in Millions)
 
Level 1
 
Level 2
 
Level 3
 
Total
 
Total (1)
Derivatives designated as hedging instruments:
 
 

 
 

 
 

 
 

 
 

Assets:
 
 

 
 

 
 

 
 

 
 

Forward foreign exchange contracts (7)
 
$
—

 
342

 
—

 
342

 
747

Interest rate contracts (2)(4) (7)
 
—

 
7

 
—

 
7

 
31

Total
 
—

 
349

 
—

 
349

 
778

Liabilities:
 
 

 
 

 
 

 
 

 
 

Forward foreign exchange contracts (7)
 
—

 
314

 
—

 
314

 
723

Interest rate contracts (3)(4) (7)
 
—

 
15

 
—

 
15

 
382

Equity collar contracts
 
—

 
—

 
—

 
—

 
57

Total
 
—

 
329

 
—

 
329

 
1,162

Derivatives not designated as hedging instruments:
 
 

 
 

 
 

 
 

 
 

Assets:
 
 

 
 

 
 

 
 

 
 

Forward foreign exchange contracts (7)
 
—

 
38

 
—

 
38

 
34

Liabilities:
 
 

 
 

 
 

 
 

 
 

Forward foreign exchange contracts (7)
 
—

 
38

 
—

 
38

 
57

Available For Sale Other Investments:
 
 
 
 
 
 
 
 
 
 
Equity investments(5)
 
751

 
—

 
—

 
751

 
1,209

Debt securities(6)
 
$
—

 
5,310

 
—

 
5,310

 
12,087


(1) 
2016 assets and liabilities are all classified as Level 2 with the exception of equity investments of $1,209 million, which are classified as Level 1.
(2) 
Includes $7 million and $23 million of non-current assets for the fiscal years ending December 31, 2017 and January 1, 2017, respectively.
(3) 
Includes $9 million and $382 million of non-current liabilities for the fiscal years ending December 31, 2017 and January 1, 2017, respectively.
(4) 
Includes cross currency interest rate swaps and interest rate swaps.
(5) 
Classified as non-current other assets. The carrying amount of the equity investments were $394 million and $520 million as of December 31, 2017 and January 1, 2017, respectively. The unrealized gains were $367 million and $757 million as of December 31, 2017 and January 1, 2017, respectively. The unrealized losses were $10 million and $68 million as of December 31, 2017 and January 1, 2017, respectively.
(6) 
Classified as cash equivalents and current marketable securities.
(7) 
Includes collateral exchanged on the credit support agreements on derivatives.