PENSION EXPENSE CALCULATION

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• PENSION EXPENSE CALCULATION
• Examples
• A. Pension Expense equals Funding, no prior
  service costs, expected and actual RoR are equal
• B. Pension Expense gt Funding, no prior service
  costs, expected and actual RoR are equal
• C. Service cost funded, prior obligations, extra
  payments, expected and actual RoR are equal
• D Service cost funded, prior obligations, extra
  payments, expected and actual RoR are unequal

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Pension Liability Balance Sheet

• Projected Benefit Obligation 3,260,000
• Plan Assets (2,165,000)
• Total Liability 1,095,000
• Current Liability (B/S) ( 970,000)
• Additional liability needed 125,000

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Recording of Addl Liability

• Dr. AOCI 125,000
• Cr. Pension liability 125,000
• AOCI Accumulated other comprehensive income

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