Hewlett-Packard reports the following schedule of comprehensive income (net income plus other comprehensive income) in its \(200710-\mathrm{K}\) report ( \(\$\) millions):

a. Describe how firms like Hewlett-Packard typically use derivatives.

b. How does HP report its derivatives designated as fair-value hedges and the hedged assets (and/or liabilities) on its balance sheet?

c. By what amount have the unrealized losses of \(\$(18)\) million on the cash flow hedges affected its current income? What are the analysis implications?

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2007 Comprehensive income (millions) Net earnings...... $7,264 Net change in unrealized gains on available-for-sale securities (12) Net change in unrealized losses on cash flow hedges (18) Net change in cumulative translation adjustment 106 Net change in additional minimum pension liability. Comprehensive income... (3) $7,337