Quarterly report pursuant to Section 13 or 15(d)

Net Income per Common Unit

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Net Income per Common Unit
 3 Months Ended
Mar. 31, 2024
Earnings Per Share [Abstract]  
Net Income per Common Unit NET INCOME PER COMMON UNIT
 
Net income per common unit for a given period is based on the distributions we incur to the common unitholders with respect to earnings or losses of the reporting period plus an allocation of undistributed net income based on provisions of the partnership agreement, divided by the weighted average number of common units outstanding. Distributions declared by us
during the period are presented on the Consolidated Statements of Partners’ Deficit. On April 29, 2024, we declared a cash distribution of $0.810 per common unit to unitholders of record as of May 9, 2024 and the related general partner distribution to be paid on May 15, 2024 with respect to the three months ended March 31, 2024. These distributions consist of a base amount of $0.775 per unit and a variable amount of $0.035 per unit.

The two-class method dictates that net income for a period be reduced by the amount of available cash that will be distributed with respect to that period and that any residual amount representing undistributed net income be allocated to common unitholders and other participating unitholders to the extent that each unit may share in net income as if all of the net income for the period had been distributed in accordance with the partnership agreement. Undistributed income is allocated to participating securities based on the distribution waterfall for available cash specified in the partnership agreement. Undistributed losses (including those resulting from distributions in excess of net income) are allocated to common units and other participating securities on a pro rata basis based on provisions of the partnership agreement. Distributions are treated as distributed earnings in the computation of earnings per common unit in the current period even though cash distributions are not necessarily derived from current period earnings.

The following table provides a reconciliation of net income and the allocation of net income to the common units, the subordinated units, the general partner units and IDRs for purposes of computing basic and diluted net income per unit (in millions, except per unit data).
  Total Limited Partner Common Units General Partner Units
IDR
Three Months Ended March 31, 2024
Net income $ 682 
Declared distributions 501  392  10  99 
Assumed allocation of undistributed net income (1) $ 181  177  4  — 
Assumed allocation of net income $ 569  $ 14  $ 99 
Weighted average units outstanding 484.0 
Basic and diluted net income per unit $ 1.18 
Three Months Ended March 31, 2023
Net income $ 1,935 
Declared distributions 714  499  14  201 
Assumed allocation of undistributed net income (1) $ 1,221  1,197  24  — 
Assumed allocation of net income $ 1,696  $ 38  $ 201 
Weighted average units outstanding 484.0 
Basic and diluted net income per unit $ 3.50 
(1)Under our partnership agreement, the IDRs participate in net income only to the extent of the amount of cash distributions actually declared, thereby excluding the IDRs from participating in undistributed net income.