P4-41. Analysis and Interpretation of Profitability Balance sheets and income statements for 3M Company follow. 3M COMPANY Consolidated Statements of Income For Years Ended December 31 ($ millions) 2018 2017 Net sales..... . . . . . . .... 12 1 101.... 532,765 $31,657 Operating expenses Cost of sales..... . .. . ... . . 16,682 16,055 Selling, general and administrative expenses 7,602 6,626 Research, development and related expenses 1.821 1,870 Gain on sale of businesses (547) (586) Total operating expenses . . . . 25,558 23,965 Operating income . . . . . . 7,207 7,692 Other expense, net* 207 144 Income before income taxes 7,000 7,548 Provision for income taxes . . 1.637 2.679 Net income including noncontrolling interest . . . . . 5,363 4.869 Less: Net income attributable to noncontrolling interest. . .. 14 11 Net income attributable to 3M. . . $ 5,349 $ 4.858 " Interest expense, gross is $350 million in 2018 and $322 milion in 2017. 3M COMPANY Consolidated Balance Sheets At December 31 ($ millions) 2018 2017 Current assets Cash and cash equivalents. . . $ 2,853 $ 3,053 Marketable securities . . . . . 380 1,076 Accounts receivable . . 5.020 4.911 Total inventories . . . 4,366 4,034 Prepaids . . .. 741 937 Other current assets . 349 266 Total current assets. . 13,709 14.277 Property, plant and equipment, net. . . . . . . . 8,738 8,866 Goodwill . . 10,051 10,513 Intangible assets-net . 2,657 2.936 Other assets . . . . 1,345 1,395 Total assets . .. . . $36,500 $37,987 Current liabilities Short-term borrowings and current portion of long-term debt. $ 1,211 $ 1,853 Accounts payable . . . . . 2,266 1,945 Accrued payroll. ... . . . . 749 870 Accrued income taxes. . 243 310 Other current liabilities 2,775 2,709 Total current liabilities . . . . 7,244 7.687 Long-term debt . . . . . 13,411 12,096 Pension and postretirement benefits 2,987 3,620 Other liabilities . . . . . . 3,010 2.962 Total liabilities. 26,652 26,365 continuedcontinued from previous page 3M COMPANY Consolidated Balance Sheets At December 31 ($ millions) 2018 2017 3M Company shareholders' equity Common stock par value . . . .. .! ! Additional paid-in capital. . . . . . . . i i 5,643 5,352 Retained earnings . . . 40.636 39.115 Treasury stock . . . . (29,626] (25.887) Accumulated other comprehensive income (loss) (6,866 (7,026 Total 3M Company shareholders' equity 9.796 11,563 Noncontrolling interest . . . . 52 59 Total equity . . . . . . . 9,848 11,622 Total liabilities and equity . ... . . . ! ! $36,500 $37.987