QUESTION 1 Partially correct Mark 2.57 out of 3.00 P Flag question Analyzing and Interpreting Pension Disclosures Assume General Mills reports the following pension footnote in its 10-K report. Defined Benefit Pension Plan ($ millions) Change in Plan Assets Fair value at beginning of year Actual return on assets Employer contributions Plan participant contributions Divestitures/acquisitions Benefit payments Fair value at end of year Change in Projected Benefit Obligation Benefit obligation at beginning of year Service cost Interest cost Plan amendment Curtailment/other Plan participant contributions Actuarial loss (gain) Benefits payments Projected benefit obligation at end of year 2010 2009 4,097.8 $ 3,620.3 81.625.9 10.6 3.6 (185.0 (164.2) $4,111.7 $4,097.8 3,257.5 2,916.4 73.1 197.7 185.6 0.2 (0.4) 80.1 (0.6) 3.6 147. 244.0 (185.0 (164.2) 3,208.1 $3,257.5 Estimated benefit payments, which reflect expected future service, as appropriate, are expected to be paid from fiscal 2011-2020 as follows: Estimated benefit payments, which reflect expected future service, as appropriate, are expected to be paid from fiscal 2011-2020 as follows: Defined Benefit (in millions) Pension Plans 2011 2012 2013 2014 2015 2016-2020 176.3 182.5 189.8 197.5 206.6 1,187.3 (a) Which of the statements below best describes what is meant by service cost and interest cost? Service cost represents the additional pension benefits earned by employees during the current year but paid to employees in the future. Interest cost is an expense that accrues on the pension obligation during the year.v OService cost represents the additional pension benefits earned by employees during the current year but paid to employees in the future. Interest cost is the expense we incur on funds borrowed by the pension plarn OService cost represents the wages earned by employees managing the pension plan during the current year. Interest cost is an expense that accrues on the pension obligation during the year OService cost represents the wages earned by employees managing the pension plan during the current year. Interest cost is the expense we incur on funds borrowed by the pension plan (b) What is the total amount paid to retirees during fiscal 2010? 182.5 X ($ million) What is the source of funds to make these payments to retirees? Opension obligations Opension liabilities Opension assets Ooperating cash flows Mark 1.00 out of 1.00