Pension Plan Calculation The Village of Dover administers a defined benefit pension plan for its police and fire personnel. Employees are not required to contribute to the plan. The village received from the actuary and other sources the following information about the Public Safety Employees’ Pension Fund as of December 31, 2011.
Annual required contribution $ 606.700
Net pension obligation, 1/11/2011 535.700
Present value of net pension obligation as of 1/1/2011 268.920
Interest rate applicable to beginning net pension obligation 7%
Assuming that the Village of Dover contributes $385,000 cash to the plan on December 31, 2011, calculate the employer’s
a. Annual pension cost.
b. Net pension obligation, as of December 31, 2011.