| Posted: 09 Jul 2010 at 21:07 | IP Logged
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Example: Prior service cost is $15,000 as
determined on January 1, 20x0. There are three employees with the
following remaining service periods affected by the amendment:
|
Employee
|
|
Service years remaining
|
| A |
|
9 |
| B |
|
2 |
| C |
|
4 |
| Total |
|
15 |
The average remaining service period is 5 years: 15/(3 employees).
Straight-line method
--
| 1.
| Amortization each year is
$3,000 ($15,000/5). Pension expense is increased $3,000 for the years
20x0 - 20x2. After that, unless another prior service grant is awarded,
pension expense will no longer reflect this component. Only the initial
PSC amount is amortized - component 2 (interest cost) automatically
includes interest on the growth in PSC because the $15,000 is included
in PBO.
can someone explain this para?...it should be 5 yrs but its states just 2000-2002(3 yrs)
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__________________
BEC-74,82(lost credit),78
FAR-67,80
AUD-75
REG-68,72,79
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Topic: pension doubt
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