Belfiori Limited reports the following data for 20X8:

The company has a contributory, defined benefit pension plan covering all employees over the age of 30 .

Required:

1. How much did the pension plan assets change during the year? Name three items that would cause plan assets to change.

2. How much did the defined benefit obligation increase during the year? Name five items that would cause this amount to change.

3. Compute the amount of the underfunded (overfunded) net position of the pension plan for accounting purposes at the beginning and the end of the year. Explain what these amounts mean.

Transcribed Image Text:

Plan assets (at fair value) Balance, 1 January Balance, 31 December Defined benefit obligation Balance, 1 January Balance, 31 December $342,800 344,100 $599,690 704,200