Accounts Receivable and Finance Receivables (Tables)

12 Months Ended

Dec. 31, 2016

Accounts Receivable and Finance Receivables

Accounts receivable

(In millions)		December 31, 2016		January 2, 2016
Commercial	$	797	$	841
U.S. Government contracts		294		239
		1,091		1,080
Allowance for doubtful accounts		(27)		(33)
Total	$	1,064	$	1,047

Finance receivables

(In millions)		December 31, 2016		January 2, 2016
Finance receivables*	$	976	$	1,135
Allowance for losses		(41)		(48)
Total finance receivables, net	$	935	$	1,087

* Includes finance receivables held for sale of $30 million at both December 31, 2016 and January 2, 2016.

Finance receivables by credit quality indicator and by delinquency aging category

(Dollars in millions)		December 31, 2016		January 2, 2016
Performing	$	758	$	891
Watchlist		101		130
Nonaccrual		87		84
Nonaccrual as a percentage of finance receivables		9.20%		7.60%
Less than 31 days past due	$	857	$	950
31-60 days past due		49		86
61-90 days past due		18		42
Over 90 days past due		22		27
60+ days contractual delinquency as a percentage of finance receivables		4.23%		6.24%

Summary of impaired finance receivables, excluding leveraged leases, and the average recorded investment

(In millions)		December 31, 2016		January 2, 2016
Recorded investment:
Impaired loans with related allowance for losses	$	55	$	62
Impaired loans with no related allowance for losses		65		42
Total	$	120	$	104
Unpaid principal balance	$	125	$	113
Allowance for losses on impaired loans		11		17
Average recorded investment		101		102

Rollforward of the allowance for losses on finance receivables and a summary of its composition, based on how the underlying finance receivables are evaluated for impairment

(In millions)		December 31, 2016		January 2, 2016
Balance at beginning of year	$	48	$	51
Provision for losses		(1)		(2)
Charge-offs		(16)		(14)
Recoveries		10		13
Balance at end of year	$	41	$	48
Allowance based on collective evaluation	$	30	$	31
Allowance based on individual evaluation		11		17
Finance receivables evaluated collectively		727		883
Finance receivables evaluated individually		120		104