Honeywell 2007 Annual Report Download - page 95
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HONEYWELL INTERNATIONAL INC.
NOTES TO FINANCIAL STATEMENTS—(Continued)
(Dollars in millions, except per share amounts)
Unrecognized tax benefits for the above listed examinations in progress were $502 million and $373 million
as of January 1, 2007 and December 31, 2007, respectively. This decrease is primarily due to the settlement of
tax examinations during the year.
Estimated interest and penalties related to the underpayment of income taxes are classified as a component
of Tax Expense in the Consolidated Statement of Operations and totaled $20 million for the twelve months ended
December 31, 2007. Accrued interest and penalties were $98 million and $118 million as of January 1, 2007 and
December 31, 2007, respectively.
Note 7—Earnings (Loss) Per Share
The following table sets forth the computations of basic and diluted earnings (loss) per share:
2007 2006 2005
Basic Assuming
Dilution Basic Assuming
Dilution Basic Assuming
Dilution
Income
Income from continuing operations $ 2,444 $ 2,444 $ 2,078 $ 2,078 $ 1,564 $
Income from discontinued
operations, net of taxes — — 5 5 95
Cumulative effect of accounting
change, net of taxes — — — — (21 )
Net income $ 2,444 $ 2,444 $ 2,083 $ 2,083 $ 1,638 $
Average shares
Average shares outstanding 764,543,613 764,543,613 820,845,838 820,845,838 848,740,395 848,740,395
Dilutive securities issuable in
connection with stock plans — 9,683,868 — 5,432,435 — 3,594,592
Total average shares 764,543,613 774,227,481 820,845,838 826,278,273 848,740,395 852,334,987
Earnings (loss) per share of
common stock
Income from continuing operations $ 3.20 $ 3.16 $ 2.53 $ 2.51 $ 1.85 $
Income from discontinued
operations, net of taxes — — 0.01 0.01 0.11
Cumulative effect of accounting
change, net of taxes — — — — (0.03 )
Net income $ 3.20 $ 3.16 $ 2.54 $ 2.52 $ 1.93 $
In 2007, 2006 and 2005, the diluted earnings per share calculation excludes the effect of stock options when
the options' exercise prices exceed the average market price of the common shares during the period. In 2007,
2006 and 2005, the number of stock options not included in the computation were 8,599,620, 22,749,056 and
17,793,385, respectively. These stock options were outstanding at the end of each of the respective years.
Note 8—Accounts, Notes and Other Receivables
December 31,
2007 2006
Trade $ 6,070 $ 5,373
Other 498 584
6,568 5,957
Less—Allowance for doubtful accounts (181) (217)