Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Please HELP ASAP!!! Sachs Brands' defined benefit pension plan specifies annual retirement benefits equal to: 1.4% x service years x final years salary, payable at

image text in transcribedPlease HELP ASAP!!!

Sachs Brands' defined benefit pension plan specifies annual retirement benefits equal to: 1.4% x service years x final years salary, payable at the end of each year. Angela Davenport was hired by Sachs at the beginning of 2002 and is expected to retire at the end of 2036 after 35 years' service. Her retirement is expected to span 18 years. Davenport's salary is $86,000 at the end of 2016 and the company's actuary projects her salary to be $260,000 at retirement. The actuary's discount rate is 8%. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (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 2016. Annual retireement payments 3. What is the company's accumulated benefit obligation at the end of 2016 with respect to Davenport? Accumulated benefit obligation 4. If no estimates are changed in the meantime, what will be the company's accumulated benefit obligation at the end of 2019 (three years later) when Davenport's salary is $95,000? Accumulated benefit obligation

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

International Finance Theory And Policy

Authors: Paul R. Krugman, Maurice Obstfeld, Marc Melitz

11th Global Edition

1292238739, 978-1292238739

More Books

Students also viewed these Finance questions

Question

each federal reserve district bank is owned by

Answered: 1 week ago

Question

LO6 Describe how to choose among the recruitment sources.

Answered: 1 week ago