Balance Sheet Detail

9 Months Ended

Jul. 31, 2011


Note 7	Balance Sheet Detail


	July 31,		October 31,
	2011		2010
	(In millions)

Inventories
Customer service spares	$	328	$	324
Raw materials		408		260
Work-in-process		457		500
Finished goods		656		463

	$	1,849	$	1,547

Included in finished goods inventory is $281 million at July 31, 2011, and $148 million at October 31, 2010, of newly-introduced systems at customer locations where the sales transaction did not meet Applied’s revenue recognition criteria as set forth in Note 1. Finished goods inventory includes $145 million and $117 million of evaluation inventory at July 31, 2011 and October 31, 2010, respectively.


			July 31,			October 31,
	Useful Life		2011			2010
	(In years)		(In millions)

Property, Plant and Equipment, Net
Land and improvements			$	169		$	227
Buildings and improvements		3-30		1,170			1,234
Demonstration and manufacturing equipment		3-5		679			670
Furniture, fixtures and other equipment		3-15		715			719
Construction in progress				24			19

Gross property, plant and equipment				2,757			2,869
Accumulated depreciation				(1,903	)		(1,906	)

			$	854		$	963

In the first quarter of fiscal 2011, Applied received $39 million in proceeds from the sale of a property located in North America and incurred a loss of $1 million on the transaction. In the third quarter of fiscal 2011, Applied received $60 million in proceeds from the sale of a property located in North America and incurred a gain of $28 million on the transaction. In the third quarter of fiscal 2011, Applied completed the divestiture of certain assets held for sale for proceeds of $27 million, net of cash sold.


	July 31,		October 31,
	2011		2010
	(In millions)

Accounts Payable and Accrued Expenses
Accounts payable	$	656	$	658
Compensation and employee benefits		405		435
Warranty		188		155
Dividends payable		105		93
Other accrued taxes		76		99
Restructuring reserve		16		104
Interest payable		15		1
Other		192		221

	$	1,653	$	1,766

Other accrued expenses included contractual termination obligation charges of $10 million and $40 million as of July 31, 2011 and October 31, 2010, respectively.


	July 31,		October 31,
	2011		2010
	(In millions)

Customer Deposits and Deferred Revenue
Customer deposits	$	442	$	407
Deferred revenue		905		440

	$	1,347	$	847

Applied typically receives deposits on future deliverables from customers in the Energy and Environmental Solutions and Display segments. In certain instances, customer deposits may be received from customers in the Applied Global Services segment.