Lockheed Martin Corporation (NYSE: LMT; Bethesda, MD) describes itself as a global security and aerospace company principally engaged in the research, design, development, manufacture, integration and sustainment of advanced technology systems, products and services, with its principal customers being agencies of the U.S. Government. On the next two pages are Lockheed Martins Consolidated Statements of Earnings, Comprehensive Income, and Balance Sheets, along with the Long-Term Debt footnote, excerpted from the its 2014 10-K. (You will not need to supplement with outside sources of company data in order to answer the questions.)

1. What is the principal or face value of Lockheed Martins long-term debt?

2. (a) To what covenant(s) is Lockheed Martin subject under the terms of their revolving credit facility?

(b) How is the covenant ratio described differently from what we might compute as part of the ROE decomposition? ACCT 607 BONUS Applied Case Assignment (Chapters 10 and 11)

3. The footnote states that In April 2013, [Lockheed Martin] repaid $150 million of long-term notes with a fixed interest rate of 7.38% due to their scheduled maturities. At the time of repayment, did the net carrying value of these long-term notes reflect at a premium, a discount, or par value? Explain.

4. Has Lockheed Martins solvency improved or deteriorated in 2014 relative to 2013? Explain your response, and identify the primary cause for that change.

Help please...EXCERPTS FROM LOCKHEED MARTIN CORPORATIONS 2014 10K