Mega Corporation Sponsors a Defined-Benefit Plan for Its Employees $\quad$

question 127

Essay

Mega Corporation sponsors a defined-benefit plan for its employees. Compute the pension cost for the year, given the following information:
Service cost $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $30,000
Interest on beginning PBO $\quad$ $\quad$ $\quad$ $\quad$ $16,000
Expected return on plan assets $\quad$ $\quad$ $\quad$ $45,000
Amortization of prior service costs $\quad$ $\quad$ $5,000
Amortization of net actuarial gain $\quad$ $\quad$ $12,000

---

Definitions:

Random Number

A number chosen by a random process for statistical purposes or simulations.

Subjective Sampling

A sampling method where the samples are selected based on the opinion or judgment of the selector rather than random or statistical methods.

Uniformly Distributed

A type of distribution where all outcomes are equally likely within a certain range.

Random Sampling

The process of selecting a subset of individuals from a population in such a way that every individual has an equal chance of being selected.