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Question
The service cost was $750,000 during 2011 and $1,125,000 during 2012.The contribution to the pension plan was $600,000 on December 31, 2011 and $1,200,000 on December 31, 2012.
The actuarially determined discount rate and the expected return on plan assets was 10%.
The actual return on plan assets was 10.5%.
Retirement benefits pertaining to years of service prior to 2011 were not granted to the employees.
At the end of the year, the pension plan is
A. underfunded by $20,000.
B. overfunded by $20,000.
C. underfunded by $24,000.
D. overfunded by $24,000.
Answer
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