See Image Below:

Problem two: DEJ, Inc. maintains a defined benefit pension plan for its employees. The plan was adopted on 1/1/YR1. Anna Bettner started work for the company on 1/1/YR1. The pension benefit formula is: Years of service X 2.0% X final salary. Pension benefits will be paid at the beginning of each year in retirement. The actuary estimates that Anna will work for 40 years (total). Her retirement is expected to span 25 years. The annuity discount rate is 4%. As of the end of YR10, Anna's salary is $100,000. The actuary estimates her final salary in YR40 will be $210,000 (approximately a 2.5% annual raise). 1. What is the PBO as of 12/31/YR10? 2. What is the ABO as of 12/31/YR10? 3. What is YR11's service cost? 4. What is YR11's interest cost? 5. What is YR11's PBO? 6. Assuming Anna received a 2.5% raise in YR11, what is YR11's ABO? 7. At the end of YR11 the company is contemplating amending the pension formula to: Years of service X 4.0% X final salary. If the company does this, what is the measurement of prior service cost? Problem two: DEJ, Inc. maintains a defined benefit pension plan for its employees. The plan was adopted on 1/1/YR1. Anna Bettner started work for the company on 1/1/YR1. The pension benefit formula is: Years of service X 2.0% X final salary. Pension benefits will be paid at the beginning of each year in retirement. The actuary estimates that Anna will work for 40 years (total). Her retirement is expected to span 25 years. The annuity discount rate is 4%. As of the end of YR10, Anna's salary is $100,000. The actuary estimates her final salary in YR40 will be $210,000 (approximately a 2.5% annual raise). 1. What is the PBO as of 12/31/YR10? 2. What is the ABO as of 12/31/YR10? 3. What is YR11's service cost? 4. What is YR11's interest cost? 5. What is YR11's PBO? 6. Assuming Anna received a 2.5% raise in YR11, what is YR11's ABO? 7. At the end of YR11 the company is contemplating amending the pension formula to: Years of service X 4.0% X final salary. If the company does this, what is the measurement of prior service cost