American Airlines 2002 Annual Report Download - page 74

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72
9. Financial Instruments and Risk Management (Continued)
Fair Values of Financial Instruments
The fair values of the Company's long-term debt were estimated using quoted market prices where
available. For long-term debt not actively traded, fair values were estimated using discounted cash flow analyses,
based on the Company's current incremental borrowing rates for similar types of borrowing arrangements. The
carrying amounts and estimated fair values of the Company's long-term debt, including current maturities, were (in
millions):
December 31,
2002 2001
Carrying
Value
Fair
Value
Carrying
Value
Fair
Value
Secured variable and fixed rate
indebtedness $ 5,474 $ 4,569 $ 3,989 $ 3,606
Enhanced equipment trust
certificates 3,623 3,153 3,094 3,025
6.0% - 8.5% bonds 949 572 176 143
Credit facility agreement 834 834 814 814
9.0% - 10.20% debentures 330 153 332 293
6.5% - 10.62% notes 303 149 343 310
Unsecured variable rate
indebtedness 86 86 86 86
Other 2 2 32 32
$ 11,601 $ 9,518 $ 8,866 $ 8,309
All other financial instruments are either carried at fair value or their carrying value approximates fair
value.
10. Income Taxes
The significant components of the income tax provision (benefit) for income (loss) from continuing
operations before extraordinary loss and cumulative effect of accounting change were (in millions):
Year Ended December 31,
2002 2001 2000
Current $ (863) $ (263) $ 47
Deferred (474) (731) 461
$ (1,337) $ (994) $ 508
The income tax provision (benefit) includes a federal income tax provision (benefit) of $(1,235) million,
$(911) million and $454 million and a state income tax provision (benefit) of $(107) million, $(90) million and $47
million for the years ended December 31, 2002, 2001 and 2000, respectively.