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Fair Value Measurements and Financial Instruments (Tables)

6 Months Ended

Jun. 30, 2020

The following table summarizes the fair value of the Company’s derivative instruments and other financial instruments which are carried at fair value in the Company’s Consolidated Balance Sheets at June 30, 2020 and December 31, 2019:


	Assets														Liabilities
	Account	Fair Value									Account				Fair Value
Designated derivative instruments		June 30, 2020				December 31, 2019					June 30, 2020				December 31, 2019
Interest rate swap contracts	Other current assets	$	—			$	—			Other accruals	$	—			$	—
Interest rate swap contracts	Other assets	17				4				Other liabilities	—				—
Forward-starting interest rate swaps	Other current assets	—				—				Other accruals	—				—
Forward-starting interest rate swaps	Other assets	—				—				Other liabilities	8				—
Foreign currency contracts	Other current assets	24				6				Other accruals	15				15
Foreign currency contracts	Other assets	—				—				Other liabilities	15				14
Commodity contracts	Other current assets	—				—				Other accruals	1				—
Total designated				$	41			$	10				$	39			$	29

Other financial instruments
Marketable securities	Other current assets	$	25			$	23
Total other financial instruments		$	25			$	23

Schedule of hedged item and cumulative adjustment to carrying amount

The following amounts were recorded on the Condensed Consolidated Balance Sheet related to the cumulative basis adjustment for fair value hedges as of:


	June 30, 2020		December 31, 2019
Long-term debt:
Carrying amount of hedged item	$	416	$	403
Cumulative hedging adjustment included in the carrying amount	17		4

Schedule of notional values

The following tables present the notional values as of:


	June 30, 2020
	Foreign Currency Contracts		Foreign Currency Debt		Interest Rate Swaps		Forward-Starting Interest Rate Swaps		Commodity Contracts		Total
Fair Value Hedges	$	445	$	—	$	400	$	—	$	—	$	845
Cash Flow Hedges	750		—		—		300		19		1,069
Net Investment Hedges	533		3,701		—		—		—		4,234

Schedule of gains (losses) recognized in Statements of Income

The following tables present the location and amount of gains (losses) recognized on the Company’s Condensed Consolidated Statements of Income:


	Three Months Ended June 30,
	2020										2019
	Cost of sales		Selling, general and administrative expenses		Interest (income) expense, net		Cost of sales		Selling, general and administrative expenses		Interest (income) expense, net
Gain (loss) on hedges recognized in income:
Interest rate swaps designated as fair value hedges:
Derivative instrument	$	—	$	—	$	(1)	$	—	$	—	$	(10)
Hedged items	—		—		1		—		—		10
Foreign currency contracts designated as fair value hedges:
Derivative instrument	—		15		—		—		11		—
Hedged items	—		(15)		—		—		(11)		—
Foreign currency contracts designated as cash flow hedges:
Amount reclassified from OCI	5		—		—		1		—		—
Commodity contracts designated as cash flow hedges:
Amount reclassified from OCI	(2)		—		—		—		—		—
Total gain (loss) on hedges recognized in income	$	3	$	—	$	—	$	1	$	—	$	—


	Six Months Ended June 30, 2020
	2020										2019
	Cost of sales		Selling, general and administrative expenses		Interest (income) expense, net		Cost of sales		Selling, general and administrative expenses		Interest (income) expense, net
Gain (loss) on hedges recognized in income:
Interest rate swaps designated as fair value hedges:
Derivative instrument	$	—	$	—	$	(13)	$	—	$	—	$	(13)
Hedged items	—		—		13		—		—		13
Foreign currency contracts designated as fair value hedges:
Derivative instrument	—		39		—		—		10		—
Hedged items	—		(39)		—		—		(10)		—
Foreign currency contracts designated as cash flow hedges:
Amount reclassified from OCI	7		—		—		4		—		—
Commodity contracts designated as cash flow hedges:
Amount reclassified from OCI	(1)		—		—		1		—		—
Total gain (loss) on hedges recognized in income	$	6	$	—	$	—	$	5	$	—	$	—

Schedule of gains (losses) included in Other Comprehensive Income

The following table presents the location and amount of unrealized gains (losses) included in OCI:


	Three Months Ended
			June 30,
			2020			2019
Foreign currency contracts designated as cash flow hedges:
Gain (loss) recognized in OCI	$	(12)		$	(2)

Forward-starting interest rate swaps designated as cash flow hedges:
Gain (loss) recognized in OCI	(8)			—

Commodity contracts designated as cash flow hedges:
Gain (loss) recognized in OCI	(2)			1
Foreign currency contracts designated as net investment hedges:
Gain (loss) on instruments	(12)			(7)
Gain (loss) on hedged items	12			7
Foreign currency debt designated as net investment hedges:
Gain (loss) on instruments	(68)			(24)
Gain (loss) on hedged items	68			24
Total unrealized gain (loss) on hedges recognized in OCI	$	(22)		$	(1)


	Six Months Ended
			June 30,
			2020			2019
Foreign currency contracts designated as cash flow hedges:
Gain (loss) recognized in OCI	$	13		$	(5)
Forward-starting interest rate swaps designated as cash flow hedges:
Gain (loss) recognized in OCI	(8)			—
Commodity contracts designated as cash flow hedges:
Gain (loss) recognized in OCI	(2)			2
Foreign currency contracts designated as net investment hedges:
Gain (loss) on instruments	13			(1)
Gain (loss) on hedged items	(13)			1
Foreign currency debt designated as net investment hedges:
Gain (loss) on instruments	(3)			5
Gain (loss) on hedged items	3			(5)
Total unrealized gain (loss) on hedges recognized in OCI	$	3		$	(3)