Sachs Brands's defined benefit pension plan specifies annual retirement benefits equal to 1,4% * service years x final year's salary. payable at the end of each year. Angela Davenport was hired by Sachs at the beginning of 2007 and is expected to retire at the end of 2041 after 35 years' service. Her retirement is expected to span 18 years. Davenport's salary is $97,000 at the end of 2021 and the company's actuary projects her salary to be $315,000 at retirement. The actuary's discount rate is 7%. (EV of $1. PV of $1, EVA of S1. PVA of $1. EVAD of $1 and PVAD of S1) (Use appropriate factor(s) from the tables provided.) Required: 2. Estimate by the accumulated benefits approach the amount of Davenport's annual retirement payments earned as of the end of 2021. 3. What is the company'yaccumulated benefit obligation at the end of 2021 with respect to Davenport? (Do not round intermediate calculations. Round yout final answer to the nearest whole dollar.) 4. f no estimates are changed in the meantime, what will be the accumulated benefit obligation at the end of 2024 (three years later), when Davenport's salary is $150,000? (Do not round intermediate calculations. Round your final answer to the nearest whole dollar.) 2. Annual retirement payments Accumulated beneft obligation 2021 4 Accumulated beneft obligation 2024
Sachs Brands's defined benefit pension plan specifies annual retirement benefits equal to 1,4% * service years x final year's salary. payable at the end of each year. Angela Davenport was hired by Sachs at the beginning of 2007 and is expected to retire at the end of 2041 after 35 years' service. Her retirement is expected to span 18 years. Davenport's salary is $97,000 at the end of 2021 and the company's actuary projects her salary to be $315,000 at retirement. The actuary's discount rate is 7%. (EV of $1. PV of $1, EVA of S1. PVA of $1. EVAD of $1 and PVAD of S1) (Use appropriate factor(s) from the tables provided.) Required: 2. Estimate by the accumulated benefits approach the amount of Davenport's annual retirement payments earned as of the end of 2021. 3. What is the company'yaccumulated benefit obligation at the end of 2021 with respect to Davenport? (Do not round intermediate calculations. Round yout final answer to the nearest whole dollar.) 4. f no estimates are changed in the meantime, what will be the accumulated benefit obligation at the end of 2024 (three years later), when Davenport's salary is $150,000? (Do not round intermediate calculations. Round your final answer to the nearest whole dollar.) 2. Annual retirement payments Accumulated beneft obligation 2021 4 Accumulated beneft obligation 2024
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter19: Accounting For Post Retirement Benefits
Section: Chapter Questions
Problem 1E
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