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Brunson Corporation Pension Plan: ending balance, PBO, over

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Please see attached file for proper format of the table.

Brunson Corporation Pension Plan
Information for Current Fiscal Year

Beginning balance of plan assets at market value $1,560,000
Actual return on plan assets 210,000
Employer's contribution 150,000
Distributions to beneficiaries 75,000
Service cost 125,000
Interest cost 156,000
Changes in benefits and assumptions 35,000
Beginning balance of the PBO 1,580,000

What is the ending balance of plan assets?
$1,770,000
$1,845,000
$1,920,000
$1,955,000

What is the ending balance of the projected benefit obligation (PBO)?
$1,730,000
$1,821,000
$1,896,000
$1,971,000

At the beginning of the year, the pension plan is:
overfunded by $20,000.
overfunded by $35,000.
underfunded by $20,000.
underfunded by $35,000.

The underfunding or overfunding of the plan at year end will be disclosed in the:
balance sheet of the plan sponsor.
balance sheet of the plan trustee at cost.
income statement of the plan sponsor
notes to the financial statements of the plan sponsor.

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What is the ending balance of plan assets?
$1,770,000
***$1,845,000
$1,920,000
$1,955,000

OTA comment:
Beg $1,560,000
+ actual return $210,000
- Benefits paid $75,000
+ contributions $150,000
= end $1,845,000

What is the ending balance of the projected benefit obligation (PBO)?
$1,730,000
***$1,821,000
$1,896,000 ...

Solution provided by:
Carol Sargent, PhD
Education
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  • MSc, University of Virginia
  • PhD, Georgia State University
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