Question
Mallard Company sponsors a pension plan with the following pension benefit: Benefit paid at each year-end during retirement = (Number of years worked x Annual
Mallard Company sponsors a pension plan with the following pension benefit:
Benefit paid at each year-end during retirement = (Number of years worked x Annual salary at retirement) 25 Credit for service began January 1, 2010, Josie's first day with the company. Josie is expected to work a total of 30 years with an annual salary at retirement at $40,000. She is expected to draw 10 years of retirement benefits. The discount rate is 10%.
Note: In answering the following questions, round your final answers to the nearest whole dollar. Do not round before your final answers.
a. Compute the PBO on December 31, 2019, if Josies current salary is $12,000.
$Answer
b. Compute the ABO on December 31, 2019, if Josies current salary is $12,000.
$Answer
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