• Financial Highlights
• Management's Discussion and Analysis
• Consolidated Financial Statements
• Notes to the Consolidated Financial Statements
  • Note 1. Summary of Significant Accounting Policies
  • Note 2. Acquisition of Unocal Corporation
  • Note 3. Information Relating to the Consolidated Statement of Cash Flows
  • Note 4. Summarized Financial Data – Chevron U.S.A. Inc.
  • Note 5. Summarized Financial Data – Chevron Transport Corporation Ltd.
  • Note 6. Stockholders’ Equity
  • Note 7. Financial and Derivative Instruments
  • Note 8. Operating Segments and Geographic Data
  • Note 9. Lease Commitments
  • Note 10. Restructuring and Reorganization Costs
  • Note 11. Investments and Advances
  • Note 12. Properties, Plant and Equipment
  • Note 13. Accounting for Buy/Sell Contracts
  • Note 14. Litigation
  • Note 15. Taxes
  • Note 16. Short-Term Debt
  • Note 17. Long-Term Debt
  • Note 18. New Accounting Standards
  • Note 19. Accounting for Suspended Exploratory Wells
  • Note 20. Employee Benefit Plans
  • Note 21. Stock Options and Other Share-Based Compensation
  • Note 22. Other Contingencies and Commitments
  • Note 23. Asset Retirement Obligations
  • Note 24. Other Financial Information
  • Note 25. Earnings Per Share
• Five-Year Operating Summary
• Five-Year Financial Summary
• Supplemental Information on Oil and Gas Producing Activities

Note 24. Other Financial Information

Millions of dollars

Net income in 2007 included gains of approximately $2,000 relating to the sale of nonstrategic properties. Of this amount, approximately $1,100 related to downstream assets and $680 related to the sale of the company's investment in Dynegy Inc.

Other financial information is as follows:

	Year ended December 31
	2007	2006	2005
Total financing interest and debt costs	$ 468	$ 608	$ 542
Less: Capitalized interest	302	157	60
Interest and debt expense	$ 166	$ 451	$ 482
Research and development expenses	$ 562	$ 468	$ 316
Foreign currency effects*	$ (352)	$ (219)	$ (61)

*Includes $18, $15 and $(2) in 2007, 2006 and 2005, respectively, for the company's share of equity affiliates' foreign currency effects.

The excess of replacement cost over the carrying value of inventories for which the Last-In, First-Out (LIFO) method is used was $6,958 and $6,010 at December 31, 2007 and 2006, respectively. Replacement cost is generally based on average acquisition costs for the year. LIFO profits of $113, $82 and $34 were included in net income for the years 2007, 2006 and 2005, respectively.