content_image/206155.jpg content_image/206166.jpg
Earnings applicable to common stock and common stock shares used in the calculation of basic and diluted earnings per share are as follows: 

<img src='content_image/206155.jpg'>

## NOTE 17 Financial Instruments, Risk Management and Fair Value Measurements 

Our financial instruments include cash and cash equivalents, trade receivables, other current assets, accounts payable, and amounts included in investments and accruals meeting the definition of 

financial instruments. The carrying value of these fi nancial instruments approximates their fair value. Our other financial instruments include the following: 

<img src='content_image/206166.jpg'>

The estimated fair value of the financial instruments in the above chart has been determined using available market information and appropriate valuation methods. Accordingly, the estimates presented may not be indicative of the amounts that we would realize in a market exchange at settlement date and do not represent potential gains or losses on these agreements. The estimated fair values of foreign exchange forward contracts and commodity forward and option contracts are included in the below tables under the “Accounting for Derivative Instruments and Hedging Activities” section. The estimated fair value of debt is $648.8 million and $638.4 million and the carrying amount is $637.9 million and $643.9 million as of December 31, 2010 and 2009, respectively. 

## Use of Derivative Financial Instruments to Manage Risk 

We mitigate certain financial exposures, including currency risk, interest rate risk, and commodity purchase exposures, through a program of risk management that includes the use of derivative fi nancial instruments. We enter into foreign exchange contracts, including forward and purchased option contracts, to reduce the effects of fl uctuating foreign currency exchange rates. 

We formally document all relationships between hedging instruments and hedged items, as well as the risk management objective and strategy for undertaking various hedge transactions. This process includes relating derivatives that are designated as fair value or cash fl ow hedges to specific assets and liabilities on the balance sheet or to specifi c fi rm commitments or forecasted transactions. We also formally assess, both at the inception of the hedge and on an ongoing basis, whether each derivative is highly effective in offsetting changes in fair values or cash fl ows of the hedged item. If we determine that a derivative is not highly effective as a hedge, or if a derivative ceases to be a highly effective hedge, we discontinue hedge accounting with respect to that derivative prospectively. 

## Foreign Currency Exchange Risk Management 

We conduct business in many foreign countries, exposing earnings, cash flows, and our financial position to foreign currency risks. Th  e majority of these risks arise as a result of foreign currency transactions. Our policy is to minimize exposure to adverse changes in currency exchange rates. This is accomplished through a controlled program of risk management that includes the use of foreign currency debt and forward foreign exchange contracts. We also use forward foreign exchange contracts 

