Relationship among pension elements
Response to the following problem:
The funded status of Hilton Paneling Inc.'s defined benefit pension plan and the balances in prior service cost and the net gain-pensions, are given below.
|
($ in 000s) |
|
|
2016
Beginning Balances
|
2016
Ending Balances
|
|
Projected benefit obligation
|
$2,300
|
$2,501
|
|
Plan assets
|
2,400
|
2,591
|
|
Funded status
|
100
|
90
|
|
Prior service cost-AOCI
|
325
|
300
|
|
Net gain-AOCI
|
330
|
300
|
Retirees were paid $270,000 and the employer contribution to the pension fund was $245,000 at the end of 2016. The expected rate of return on plan assets was 10%, and the actuary's discount rate is 7%. There were no changes in actuarial estimates and assumptions regarding the PBO.
Required:
Determine the following amounts for 2016:
1. Actual return on plan assets
2. Loss or gain on plan assets
3. Service cost
4. Pension expense
5. Average remaining service life of active employees (used to determine amortization of the net gain) .