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Annual Report

2 Cost of sales

Cost of sales includes interest expenses of €2,418 million (previous year: €2,789 million) attributable to the financial services business. This item includes impairment losses on intangible assets, property, plant and equipment, and leasing and rental assets in the amount of €1,301 million (previous year: €591 million). Impairment losses are based on updated impairment tests and reflect market and exchange rate risks in particular, as well as amended sales forecasts and reduced product life cycles.

Government grants related to income amounted to €216 million in fiscal year 2010 (previous year: €98 million) and were generally allocated to the functions.

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