Carson Industries Limited (CIL) has a defined benefit pension plan covering all employees. The defined benefit obligation was \(\$ 7,004,000\) at the beginning of the current year, which is \(\$ 1,675,000\) higher than fund assets. Plan revaluation is done every three years, and plan improvements are expected approximately every six years.

Required:

1. CIL has an ARSP of 14 years, and benefits in the pension plan vest after a total of 10 years. Explain the meaning of each of these terms.

2. CIL reports unamortized past service cost of \(\$ 880,000\); the PSC has already been amortized for four years. CIL has unamortized actuarial losses of \(\$ 224,000\) at the beginning of the current year. Explain how each of these amounts arose.

3. CIL has four alternatives for recognition of the actuarial losses. Calculate the amount in pension expense, if any, under each alternative.

4. Calculate the PSC to be included in pension expense.