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1. How much did the Net Income/(Loss) increase or decrease (in $ amounts) from the previous year?
2. Which expense (if any) increased the most (in $) from the previous year? Which expense (if any) decreased the most (in $)?
   • List the accounts and the amounts.
   • List one possible cause for each change identified above.

Consolidated Statements of Income (Millions of dollars, except share and per-share amounts) For Years Ended December 31, 2019 2018 2017 Revenue Cost of revenue (COR) Gross profit Research and development (R&D). Selling, general and administrative (SG&A) Acquisition charges Restructuring charges/other Operating profit Other income (expense), net (OI&E) Interest and debt expense Income before income taxes Provision for income taxes Net income $ 14,383 5,219 9,164 1,544 1,645 288 (36) 5,723 175 170 $ 15,784 5,507 10,277 1,559 1,684 318 3 6,713 98 125 6,686 1,106 $ 14,961 5,347 9,614 1,508 1,694 318 11 6,083 75 78 FORM 10-K 5,728 711 6,080 2,398 $ 5,017 $ 5,580 $ 3,682 Earnings per common share (EPS): Basic $ 5.33 $ 5.71 $ 3.68 Diluted $ 5.24 $ 5.59 $ 3.61 Average shares outstanding (millions): Basic 936 970 991 Diluted 952 990 1,012 A portion of net income is allocated to unvested restricted stock units (RSUS) on which we pay dividend equivalents. Diluted EPS is calculated using the following: Net income Income allocated to RSUS Income allocated to common stock for diluted EPS $ 5,017 (31) $ 4,986 $ 5,580 (42) $ 5,538 $ 3,682 (33) $ 3,649 See accompanying notes

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