Othello Steel Provides a Defined Benefit Pension Plan for Its

question 33

Essay

Othello Steel provides a defined benefit pension plan for its employees. One of its employees, Ginger Philips, who just turned 45 years old, expects to retire at age 70. At that time, the pension plan will pay Ginger annual pension payments equal to 10% of her final year's salary for each year of services rendered. The pension payments will continue until Ginger's death, which actuaries expect to be when she turns 95 years old. Ginger is currently earning $75,000 per year, and this rate is not expected to increase due to the poor state of the steel industry. Orion Steel uses a 6 % interest rate for its pension obligations.
Required:
Determine the current service cost for Ginger Philips's pension for the past year (the year just before she turned 45).

Understand the primary components of an internal control system and differentiate between control activities.

Recognize the classification and treatment of cash and cash equivalents in financial reporting.

Identify the objectives and components of physical controls to safeguard assets.

Comprehend the periodicity and independence requirement of internal reviews for reinforcing internal controls.

---

Definitions:

ADHD

Attention Deficit Hyperactivity Disorder, a neurological disorder characterized by problems with focus, hyperactivity, and impulsiveness.

7th Graders

Students who are typically between the ages of 12 and 13, studying in the seventh grade of school in many educational systems.

Environmental Correlates

Factors within the environment that are associated with the occurrence of specific behaviors or conditions.

Change Blindness

A perceptual phenomenon that occurs when a change in a visual stimulus is introduced and the observer does not notice it.