Northrop Grumman 2012 Annual Report Download - page 68

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NORTHROP GRUMMAN CORPORATION
-58-
Accounts receivable consisted of the following:
December 31
$ in millions 2012 2011
Due on U.S. Government contracts
Amounts billed $ 794 $ 812
Recoverable costs and accrued profit on progress completed - unbilled 1,396 1,594
2,190 2,406
Due on non-U.S. Government contracts
Amounts billed 314 249
Recoverable costs and accrued profit on progress completed - unbilled 414 363
728 612
Total accounts receivable 2,918 3,018
Allowance for doubtful accounts (60)(54)
Total accounts receivable, net $2,858 $2,964
6. INVENTORIED COSTS, NET
Inventoried costs consisted of the following:
December 31
$ in millions 2012 2011
Production costs of contracts in process $1,593 $1,629
General and administrative expenses 262 221
1,855 1,850
Progress payments received (1,167)(1,100)
688 750
Product inventory 110 123
Total inventoried costs, net $ 798 $ 873
7. INCOME TAXES
The company’s effective tax rate on earnings from continuing operations for the year ended December 31, 2012, was
33.3 percent, as compared with 32.3 percent and 19.5 percent for the years ended December 31, 2011 and 2010,
respectively. The company's higher effective tax rate for 2012, as compared to 2011, reflects the absence of research
tax credits, which expired at the end of 2011. The company's higher effective tax rate for 2011, as compared to 2010,
was primarily due to recognized net tax benefits of $298 million in 2010 to reflect the final approval from the IRS
and the U.S. Congressional Joint Committee on Taxation of the IRS’ examination of our tax returns for the years
2004 through 2006.
Federal and foreign income tax expense consisted of the following:
Year Ended December 31
$ in millions 2012 2011 2010
Income Taxes on Continuing Operations
Currently payable
Federal income taxes $912 $592 $394
Foreign income taxes 15 18 11
Total federal and foreign income taxes currently payable 927 610 405
Change in deferred federal and foreign income taxes 60 387 57
Total federal and foreign income taxes $987 $997 $462
Earnings from foreign continuing operations before income taxes is not material for all periods presented.