Lockheed Martin Corporation discloses the following funded status for its defined benefit pension plans in its \(10-\mathrm{K}\) report.

Lockheed contributed \(\$ 335\) million to its pension plan assets in 2007, down from \(\$ 693\) million in the prior year. The company also reports that it is obligated for the following expected payments to retirees in the next five years.

a. How is this funded status reported in Lockheed's balance sheet under current GAAP?

b. How should we interpret this funded status in our analysis of the company?

c. Lockheed projects payments to retirees of over \(\$ 1.5\) billion per year. How is the company able to contribute only \(\$ 335\) million to its pension plan?

d. What likely effect would a substantial decline in the financial markets have on Lockheed's contribution to its pension plans? Explain.

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Defined Benefit Pension Plans (In millions) 2007 2006 Unfunded status of the plans.... $(879) $(2,790)