Question 1

Current service cost for a defined benefit pension plan amounted to $6,000,000. This pension plan's assets generated $5,500,000 of income, which exceeded expectations by $1,000,000. Pension obligations incurred interest cost of $4,500,000, which were above expectations by $200,000. During the year, the company increased benefits in the pension plan and incurred $400,000 for past service cost. (5 marks)

Required:

Compute the amount of pension expense for the year.