Segment Information (Unaudited)

6 Months Ended

Jun. 30, 2017

Segment Reporting [Abstract]

SEGMENT INFORMATION

SEGMENT INFORMATION

The company is aligned in three operating sectors, which also comprise our reportable segments: Aerospace Systems, Mission Systems and Technology Services.

The following table presents sales and operating income by segment:

	Three Months Ended June 30						Six Months Ended June 30
$ in millions	2017			2016			2017			2016
Sales
Aerospace Systems	$	2,970		$	2,600		$	5,868		$	5,174
Mission Systems	2,781			2,690			5,520			5,383
Technology Services	1,175			1,213			2,369			2,427
Intersegment eliminations	(551		)	(503		)	(1,115		)	(1,028		)
Total sales	6,375			6,000			12,642			11,956
Operating income
Aerospace Systems	315			312			627			598
Mission Systems	374			351			727			704
Technology Services	134			131			265			257
Intersegment eliminations	(70		)	(63		)	(140		)	(127		)
Total segment operating income	753			731			1,479			1,432
Net FAS/CAS pension adjustment	137			69			273			143
Unallocated corporate expenses	(34		)	(3		)	(63		)	(36		)
Other	(1		)	—			(2		)	(3		)
Total operating income	$	855		$	797		$	1,687		$	1,536

Net FAS/CAS Pension Adjustment

For financial statement purposes, we account for our employee pension plans in accordance with FAS. However, the cost of these plans is charged to our contracts in accordance with the Federal Acquisition Regulation (FAR) and the related U.S. Government Cost Accounting Standards (CAS). The net FAS/CAS pension adjustment reflects the difference between CAS pension expense included as cost in segment operating income and FAS expense included in total operating income.

Unallocated Corporate Expenses

Unallocated corporate expenses include the portion of corporate expenses not considered allowable or allocable under applicable CAS or the FAR, and therefore not allocated to the segments. Such costs consist of a portion of management and administration, legal, environmental, compensation, retiree benefits and corporate unallowable costs.