[Anonymous]

Hi all.

New here and while studying, I came across a question that dealt with creating a pension worksheet.

Question 1: How do I treat the differences in BB and EB for accumulated benefit obligations and vested benefit obligations in terms of applying it to the pension worksheet?

Question 2: Since there is no settlement rate provided by the actuary for beginning of 2014, do I use the Dec 31 settlement rate to calculate the interest cost? (BB of PBO x settlement rate at Dec 31)

Example

January 1, 2014 December 31, 2014

Vested benefit obligation $2,670 $2,140

Accumulated benefit obligation 2,140 3,110

Projected benefit obligation 2,120 3,230

Plan assets (fair value) 1,290 2,510

Settlement rate and expected rate of return 10%

Pension asset/liability 830 ?

Service cost for the year 2014 390

Contributions (funding in 2014) 860

Benefits paid in 2014 320