How are benefit pension plans net funded status aggregated or disaggregated?
Homework Answers
What is benefit pension plan:
This is the benefit plan for employee/nominee to pay them fix monthly amount after they retire/death work with company for longer time.
What is Funded status of benefit pension plan means:
The funded status of a pension plan is the fair value of the plan's assets minus the present value of its projected benefit obligation.
For a plan the status need to calculated as over funded, adequately funded or under funded.
Funded Status:
The funded status of a pension plan is the fair value of the plans assets minus the present value of its projected benefit obligation.
- The fair value of plan assets is straightforward, it's the fair value of the funds invested to pay pension obligations. These are often invested in financial assets like stocks, bonds, and government securities.
- The present value of the projected benefit obligation (PBO) is how much the company anticipates it will have to pay out to present and future retirees discounted to the statement date. If the funded status is positive (as in, assets exceed PBO) it creates a net pension asset on the balance sheet; if negative (as in, PBO exceeds assets) the plan is underfunded, and a net liability is created.
What does Aggregated Mean?
It is the process of comparison of funded position of Defined benefit Plans, of one or more companies, jointly to evaluate whether the Aggregated fund is overfunded or underfunded.
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The funded status of blank inc.’s defined benefit pension plan and the balances in prior service...
The funded status of blank inc.’s defined benefit pension plan and the balances in prior service cost and the net gain-pensions, are displayed ($ = thousands) 2025 beginning balances 2025 ending balances PBO 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 The retirees were paid $2,700 and the employer contribution to the pension fund was $245,000 at the end of 2025. The expected rate of return on plan assets...
M10-21. Analyzing and Interpreting Pension Plan Benefit Footnotes Lockheed Martin Corporation discloses the follow...
M10-21. Analyzing and Interpreting Pension Plan Benefit Footnotes Lockheed Martin Corporation discloses the following funded status for its defined benefit pension plans in its 10-K report, LO2 Lockheed Martin Corporation (LMT) Defined Benefit Pension Plans ($ millions) 2015 Unfunded status of the plans...... .......... $(11,606) Lockheed contributed $5 million to its pension plan assets in 2015, down drastically from $2,000 mil- lion in the prior year. The company also reports that it is obligated for the following expected payments to...
CASE 14-5 Pension Funding Status Penny Pincher Company has a defined benefit pension plan for its...
CASE 14-5 Pension Funding Status Penny Pincher Company has a defined benefit pension plan for its employees. The following pension data are available at year-end (in millions): Accumulated benefit obligation $142 Projected benefit obligation 205 Fair value of plan assets 175 There is no balance in prepaid/accrued pension costs. Required: a. Calculate the funded status of the plan (see SFAS No. 158 for a definition of funded status). Is the plan overfunded or underfunded? b. If the projected benefit obligation...
Linseed has Noncontributory, Funded, Defined Benefit Pension Plan. As of 12-31-2016, the projected benefit obligation (PBO)...
Linseed has Noncontributory, Funded, Defined Benefit Pension Plan. As of 12-31-2016, the projected benefit obligation (PBO) was $468,000. As of 12-31-2016, the fair value of the pension plan assets was $544,000. As do may companies, Linseed tries to minimize its reported liabilities on the balance sheet while complying with generally accepted accounting principles (GAAP). On its 12-31-2016 balance sheet Linseed will report a
Brief Exercise 20-10 Sarasota Corp. has three defined benefit pension plans as follows. Plan X Pension...
Brief Exercise 20-10 Sarasota Corp. has three defined benefit pension plans as follows. Plan X Pension Assets (at Fair Value) $641,000 860,000 558,000 Projected Benefit Obligation $493,000 665,000 739,000 Plan Y Plan z How will Sarasota report these multiple plans in its financial statements? Pension Asset $ Pension Liability Click if you would like to Show Work for this question: Open Show Work
gain-pensions, are given below. Projected benefit obligation Plan assets Funded status Prior service cost-AOCI Net gain-AOCI...
gain-pensions, are given below. Projected benefit obligation Plan assets Funded status Prior service cost-AOCI Net gain-AOCI ($ in 00s) 2018 2018 Beginning Ending Balances Balances $4,000 $ 4,501 4,400 4,791 400 290 425 400 460 395 Retirees were paid $250,000 and the employer contribution to the pension fund was $265,000 at the end of 2018. The expected rate of return on plan assets was 10%, and the actuary's discount rate is 8%. There were no changes in actuarial estimates and...
Traveltime Tours has a defined benefit pension plan. As a new employee, you are interested in...
Traveltime Tours has a defined benefit pension plan. As a new employee, you are interested in the future well-being of the plan. To help you visualize your assessment, you use your Excel skills to graph the key numbers. The line graph below plots the balances of the company's Projected Benefit Obligation and its Plan Assets over the most recent six years. DEFINED BENEFIT PENSION PLAN Pension Plan Assets - Projected Benefit Obligation $35,000 $30,000 $25,000 $20,000 BALANCES $15,000 $10,000 $5,000...
Analyzing and Interpreting Pension Disclosures Assume E.I. Du Pont De Nemours and Co.'s 10-K report has...
Analyzing and Interpreting Pension Disclosures Assume E.I. Du Pont De Nemours and Co.'s 10-K report has the following disclosures related to its retirement plans ($ millions). Pension Benefits ($ millions) 2010 2009 Change in benefit obligation Benefit obligation at beginning of year $ 22,849 $ 22,935 Service cost 383 388 Interest cost 1,228 1,192 Plan participants' contributions 13 9 Acturarial loss (gain) (728) (244) Benefits paid (1,544) (1,506) Amendments -- (1) Net effects of acquisitions/divestitures 5 76 Benefit obligation at...
When governmental entities provide defined benefit pension plans to governmental employees, a pension trust fund is...
When governmental entities provide defined benefit pension plans to governmental employees, a pension trust fund is used by the governmental entity that is acting as a trustee on behalf of current and future retirees to manage the funds at the "plan" level. The pension trust fund reports liabilities on its Statement of Fiduciary Net Position that primarily are related to pension benefits currently due to retired employees. The statement does not report a long-term liability for an unfunded portion, if...
When governmental entities provide defined benefit pension plans to governmental employees, a pension trust fund is...
When governmental entities provide defined benefit pension plans to governmental employees, a pension trust fund is used by the governmental entity that is acting as a trustee on behalf of current and future retirees to manage the funds at the "plan" level. The pension trust fund reports liabilities on its Statement of Fiduciary Net Position that primarily are related to pension benefits currently due to retired employees. The statement does not report a long-term liability for an unfunded portion, if...
M10-21. Analyzing and Interpreting Pension Plan Benefit Footnotes Lockheed Martin Corporation discloses the following funded status for its defined benefit pension plans in its 10-K report, LO2 Lockheed Martin Corporation (LMT) Defined Benefit Pension Plans ($ millions) 2015 Unfunded status of the plans...... .......... $(11,606) Lockheed contributed $5 million to its pension plan assets in 2015, down drastically from $2,000 mil- lion in the prior year. The company also reports that it is obligated for the following expected payments to...
CASE 14-5 Pension Funding Status Penny Pincher Company has a defined benefit pension plan for its employees. The following pension data are available at year-end (in millions): Accumulated benefit obligation $142 Projected benefit obligation 205 Fair value of plan assets 175 There is no balance in prepaid/accrued pension costs. Required: a. Calculate the funded status of the plan (see SFAS No. 158 for a definition of funded status). Is the plan overfunded or underfunded? b. If the projected benefit obligation...
Brief Exercise 20-10 Sarasota Corp. has three defined benefit pension plans as follows. Plan X Pension Assets (at Fair Value) $641,000 860,000 558,000 Projected Benefit Obligation $493,000 665,000 739,000 Plan Y Plan z How will Sarasota report these multiple plans in its financial statements? Pension Asset $ Pension Liability Click if you would like to Show Work for this question: Open Show Work
gain-pensions, are given below. Projected benefit obligation Plan assets Funded status Prior service cost-AOCI Net gain-AOCI ($ in 00s) 2018 2018 Beginning Ending Balances Balances $4,000 $ 4,501 4,400 4,791 400 290 425 400 460 395 Retirees were paid $250,000 and the employer contribution to the pension fund was $265,000 at the end of 2018. The expected rate of return on plan assets was 10%, and the actuary's discount rate is 8%. There were no changes in actuarial estimates and...
Traveltime Tours has a defined benefit pension plan. As a new employee, you are interested in the future well-being of the plan. To help you visualize your assessment, you use your Excel skills to graph the key numbers. The line graph below plots the balances of the company's Projected Benefit Obligation and its Plan Assets over the most recent six years. DEFINED BENEFIT PENSION PLAN Pension Plan Assets - Projected Benefit Obligation $35,000 $30,000 $25,000 $20,000 BALANCES $15,000 $10,000 $5,000...
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