Purchase Solution

Analyzing and Interpreting Pension Disclosures for Campbell Soup

Not what you're looking for?

Ask Custom Question

a. What type of pension plan does Campbell Soup offer its employees?
b. Does Campbell Soup have a net pension asset or a net pension liability at July 28, Year 11? What is the amount?
c. Identify the amounts of the vested, accumulated, and projected benefit obligations at July 28, Year 11. What do those amounts represent?
d. What is the amount of the assets currently held by the pension plan?
e. What types of assets are held by the pension plan?
f. What is the net economic position of the pension plan?
g. What creates the difference between the net pension asset (liability) and the net economic position of the pension plan?
h. How much unrecognized prior service cost is left to amortize to pension expense?
i. Comment on the reasonableness of the expected return on plan assets.
j. Comment on the reasonableness of the long-term rate of compensation increase for employees. Comment from the viewpoint of an equity analyst and the viewpoint of a potential employee.

Sourced from Wild-Subramanyan-Halsey: Financial Statement Analysis, Ninth Edition.
Appendix A: Financial Statements
Campbell Soup
Copyright: The McGraw-Hill Companies, 2007.

Purchase this Solution

Solution Summary

Your response is 409 words and responds to the queries posted. The source for the amounts is from the "year 11" amounts in the Footnote 8 attached to the posting (and not the current Annual Report of Campbell Soup).

Solution Preview

a. What type of pension plan does Campbell Soup offer its employees?

Defined Benefit Plan

b. Does Campbell Soup have a net pension asset or a net pension liability at July 28, Year 11? What is the amount?

Net pension asset of $30.0

c. Identify the amounts of the vested, accumulated, and projected benefit obligations at July 28, Year 11. What do those amounts represent?

Vested benefit obligation = present value of pension payments at retirement that will be paid even if no added service is rendered (=vested), given their current years of service and salary level (the expected future pension payments using current salary levels) = 679.6

Accumulated benefit obligation = present value of what you think the pension participants will get at retirement given their current years of service and salary level (the expected future pension payments using current salary levels) = 714.4

Projected benefit obligation = present ...

Solution provided by:
Education
  • BSc, University of Virginia
  • MSc, University of Virginia
  • PhD, Georgia State University
Recent Feedback
  • "hey just wanted to know if you used 0% for the risk free rate and if you didn't if you could adjust it please and thank you "
  • "Thank, this is more clear to me now."
  • "Awesome job! "
  • "ty"
  • "Great Analysis, thank you so much"
Purchase this Solution


Free BrainMass Quizzes
Marketing Research and Forecasting

The following quiz will assess your ability to identify steps in the marketing research process. Understanding this information will provide fundamental knowledge related to marketing research.

MS Word 2010-Tricky Features

These questions are based on features of the previous word versions that were easy to figure out, but now seem more hidden to me.

Understanding the Accounting Equation

These 10 questions help a new student of accounting to understand the basic premise of accounting and how it is applied to the business world.

Motivation

This tests some key elements of major motivation theories.

Cost Concepts: Analyzing Costs in Managerial Accounting

This quiz gives students the opportunity to assess their knowledge of cost concepts used in managerial accounting such as opportunity costs, marginal costs, relevant costs and the benefits and relationships that derive from them.