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Depreciation expense, including the amortization of capitalized interest in 2014, 2013 and 2012, was $2.5 billion, $2.7
billion and $2.5 billion, respectively.
Upon retirement or other disposal of property, plant and equipment, the costs and related amounts of accumulated
depreciation or amortization are eliminated from the asset and accumulated depreciation accounts, respectively. The
difference, if any, between the net asset value and the proceeds are recorded in earnings.
5. Intangible Assets and Goodwill
At the end of 2014 and 2013, the gross and net amounts of intangible assets were:
(Dollars in Millions) 2014 2013
Intangible assets with definite lives:
Patents and trademarks – gross $9,074 9,164
Less accumulated amortization 4,700 4,146
Patents and trademarks – net $4,374 5,018
Customer relationships and other intangibles – gross $17,970 19,027
Less accumulated amortization 5,227 4,872
Customer relationships and other intangibles – net $12,743 14,155
Intangible assets with indefinite lives:
Trademarks $7,263 7,619
Purchased in-process research and development 2,842 1,155
Total intangible assets with indefinite lives $10,105 8,774
Total intangible assets – net $27,222 27,947
Goodwill as of December 28, 2014 and December 29, 2013, as allocated by segment of business, was as follows:
(Dollars in Millions) Consumer Pharmaceutical Med Devices Total
Goodwill at December 30, 2012 $8,519 1,792 12,113 22,424
Goodwill, related to acquisitions 83 246 9 338
Goodwill, related to divestitures (71) – – (71)
Currency translation/other – 30 77 107
Goodwill at December 29, 2013 $8,531 2,068 12,199 22,798
Goodwill, related to acquisitions 13 665 – 678
Goodwill, related to divestitures (138) – (603) (741)
Currency translation/other (731) (107) (65) (903)
Goodwill at December 28, 2014 $7,675 2,626 11,531 21,832
The weighted average amortization periods for patents and trademarks and customer relationships and other intangible
assets are 17 years and 24 years, respectively. The amortization expense of amortizable assets included in cost of
products sold was $1,398 million, $1,363 million and $1,146 million before tax, for the fiscal years ended December 28,
2014, December 29, 2013 and December 30, 2012, respectively. The estimated amortization expense for the five
succeeding years approximates $1,300 million before tax, per year.
See Note 20 to the Consolidated Financial Statements for additional details related to acquisitions and divestitures.
6. Fair Value Measurements
The Company uses forward foreign exchange contracts to manage its exposure to the variability of cash flows, primarily
related to the foreign exchange rate changes of future intercompany product and third-party purchases of materials
denominated in a foreign currency. The Company uses cross currency interest rate swaps to manage currency risk
primarily related to borrowings. Both types of derivatives are designated as cash flow hedges.
32 •Johnson & Johnson 2014 Annual Report