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Calculation of Pension Expense And Underfunded Retirement Plan

Question

1. Taylor Corp reported the following items in the 2012 pension footnote (in millions).

Service cost

$1,012

Benefits paid to retirees

290

Interest cost

980

Actual returns on pension plan assets

1,400

Expected returns on pension plan assets

1,540

Amortization of deferred amounts

$ 62



2. Buckeye Inc. has a defined benefit retirement plan. The company’s 2012 annual report includes the following excerpt about these plans (in millions):

Projected benefit obligations, January 1, 2012

$8,606

Service cost — benefits earned during the year

332

Interest cost on projected benefit obligations

446

Actuarial losses (gains)

608

Benefits paid

(294)

Settlement

(776)

Other, primarily foreign currency translation

41

Projected benefit obligations, December 31, 2012

$8,963

 

 

Plans' assets at fair value, January 1, 2012

$7,451

Actual return on plan assets

29

Company contributions

394

Benefits paid

(294)

Settlement

(776)

Other, primarily foreign currency translation

157

Plan assets at fair value, December 31, 2012

$6,961

What is the funded status of this plan?

Summary

These short answer questions belong to Finance. The 1st question is about calculating pension expense and the 2nd question is about calculation of underfunded retirement plan.

Total Word Count NA

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