Honeywell 2007 Annual Report Download - page 88

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HONEYWELL INTERNATIONAL INC.
NOTES TO FINANCIAL STATEMENTS—(Continued)
(Dollars in millions, except per share amounts)
connection with an arbitration award for overcharges by a supplier of phenol to our Specialty Materials business
from June 2003 through the end of 2004. We recognized impairment charges of $23 million related to the write-
down of property, plant and equipment held and used in our Specialty Materials segment. We also recognized
other charges of $18 million principally related to the modification of a lease agreement for the Corporate
headquarters facility ($10 million) and for various legal settlements ($7 million).
Note 4—Other (Income)/Expense
Years Ended December 31,
2007 2006 2005
Gain on sale of non-strategic businesses and assets $ (19) $ (30) $ (36)
Equity (income)/loss of affiliated companies (10) (13) (134)(1)
Interest income (81) (94) (84)
Foreign exchange 34 18 21
Other (net) 23 8 2
$ (53) $ (111) $ (231)
(1) Includes equity income of $107 million in 2005 from UOP (acquisition to full ownership in November 2005).
Note 5—Interest and Other Financial Charges
Years Ended December 31,
2007 2006 2005
Total interest and other financial charges $ 478 $ 396 $ 373
Less—capitalized interest (22) (22) (17)
$ 456 $ 374 $ 356
The weighted average interest rate on short-term borrowings and commercial paper outstanding at
December 31, 2007 and 2006 was 4.65 percent and 5.67 percent, respectively.
Note 6—Income Taxes
Income from continuing operations before taxes
Years Ended December 31,
2007 2006 2005
United States $ 2,084 $ 1,882 $ 1,530
Foreign 1,237 916 766
$ 3,321 $ 2,798 $ 2,296
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