PR 5 - Pension plan calculations. The following information is for the pension plan for the employees of Faulk, Inc. 12/31/07 12/31/08 Accumulated benefit obligation $2,800,000 $3,760,000 Projected benefit obligation 3,040,000 4,000,000 Fair value of plan assets 3,080,000 3,520,000 Market-related value of assets 2,960,000 3,440,000 Net (gain) or loss (425,000) (480,000) Settlement rate 8% 8% Expected rate of return 6% Faulk estimates that the average remaining service life is 15 years. Faulk's contribution was $520,000 in 2008 and benefits paid were $280,000 Instructions (a) Calculate the interest cost for 2008. (b) Calculate the actual return on plan assets in 2008. (c) Calculate the unexpected gain or loss in 2008. (d) Calculate the corridor for 2008 and the amortization of the net gain for 2008. 7%