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Tresset [83]
3 years ago
14

Sachs Brands's defined benefit pension plan specifies annual retirement benefits equal to 1.6% × service years × final year's sa

lary, payable at the end of each year. Angela Davenport was hired by Sachs at the beginning of 2007 and is expected to retire at the end of 2041 after 35 years' service. Her retirement is expected to span 18 years. Davenport's salary is $90,000 at the end of 2021 and the company's actuary projects her salary to be $240,000 at retirement. The actuary's discount rate is 7%. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: 2. Estimate by the projected benefits approach the amount of Davenport's annual retirement payments earned as of the end of 2021. 3. What is the company's projected benefit obligation at the end of 2021 with respect to Davenport? (Do not round intermediate calculations. Round your final answer to the nearest whole dollar.) 4. If no estimates are changed in the meantime, what will be the company's projected benefit obligation at the end of 2024 (three years later) with respect to Davenport? (Do not round intermediate calculations. Round your final answer to the nearest whole dollar.)
Business
1 answer:
marishachu [46]3 years ago
3 0

Answer:

Kindly check explanation

Explanation:

Given the following :

Annual retirement benefit plan: (1.6% * service years * final years' salary

Year of hire = beginning of 2007

Retiremet year = 2041

Years of service = 35

Required: 2. Estimate by the projected benefits approach the amount of Davenport's annual retirement payments earned as of the end of 2021.

1.6% * service years * final years' salary

Service years = 2021 - beginning of 2007 = 15 years on service

Salary at the end of 2021 = $90000

Hence,

1.6% * 15 * 90000 = $21,600

3. What is the company's projected benefit obligation at the end of 2021 with respect to Davenport?

Period (n) = Retiremet span = 18 years ; rate (r) = 7% ;

Present value of ordinary annuity $1 ; n = 18 ; r = 7% = 10.0591

$21,600 * 10.0591 = $217,276.56

= $217,277

Present value of retirement benefit at the end of 2041

PV factor $1 ; period (2041 - 2021) = 20 ; r = 7% = 0.258

$217,277 * 0.258 = $56,057.466

$56,057

4. If no estimates are changed in the meantime, what will be the company's projected benefit obligation at the end of 2024 (three years later) with respect to Davenport?

1.6% × 18 years × $90000 = $25920

Present value of ordinary annuity $1 ; n = 18 ; r = 7% = 10.0591

$25920 × 10.0591 = $260732

PV factor $1 ; period (2041 - 2021) = 20 - 3 = 17; n = 17 ; r = 7% = 0. 317

$260732 × 0.317 = $82652.044 = $82652

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KiRa [710]

Answer:

1. Cost per unit = 860,500/45000 units = $19.12

2. Mark up = 12% * 800,000 = $96,000/45000 units = $2.13

mark up = 2.13/19.12 = 11.14%

3. Therefore selling price per unit = $19.12+$2.13 = $21.25

Explanation:

Variable direct materials cost per unit............................ 5.50

Variable direct labor cost per unit.................................... 7.65

Variable factory overhead cost per unit .........................2.25

Variable selling and administrative cost per unit........... .90

TOTAL VARIABLE COST PER UNIT..................................16.3

TOTAL VARIABLE COST = $16.3*45000 units = $733,500

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Fixed selling and administrative costs 45,000

TOTAL COST = $ 860,500

1. Cost per unit = 860,500/45000 units = $19.12

2. Mark up = 12% * 800,000 = $96,000/45000 units = $2.13

mark up = 2.13/19.12 = 11.14%

3. Therefore selling price per unit = $19.12+$2.13 = $21.25

5 0
3 years ago
Pharoah Industries collected $106,000 from customers in 2019. Of the amount collected, $24,200 was for services performed in 201
vodka [1.7K]

Answer:

A. $33,200

B. $35,000

Explanation:

A. Computation for 2018 cash-basis net income

2018 cash-basis net income = $106,000 - $73,800

2018 cash-basis net income= $33,200

Therefore 2018 cash-basis net income is $33,200

(b) Computation for 2018 accrual-basis net income

2018 accrual-basis net income = ($106,000 - $24,200 + $39,400) - ( $73,800 - $29,100 + $41,500))

2018 accrual-basis net income= $121,200 - $86,200

2018 accrual-basis net income= $35,000

Therefore 2018 accrual-basis net income is $35,000

3 0
2 years ago
An account credits interest at an effective rate of 4% for years 1-3, 5% for years 4-6, and 6% for years 7-9. Deposits of $1,000
netineya [11]

Answer:

The accumulated value of the deposits at the end of 9 years is <u>$11,242.18</u>

Explanation:

Note: Find attached the excel file for the calculation.

Since the deposits are made into the account at the end of each year, interest will be earned on the opening balance for each year since it remains the account for 12 months.

No interest will be earned on the deposit of $1,000 made at the end of each year.

The opening balance, interest earned and the deposit for each year are then added together to obtain the closing balance for each year.

Since the closing balance for year 9 is <u>$11,242.18</u>, this is therefore the accumulated value of the deposits at the end of 9 years.

Download xlsx
3 0
3 years ago
A company's marketing mechanism is deemed successful only if
forsale [732]
It attracts new customers and gets positive response.
Good marketing attracts more customers, more customers means more profit deeming it to be successful.
5 0
2 years ago
On January 1, 2017, Accounts Receivable and Allowance for Uncollectible Accounts for Darius Company carried balances of $20,000
kupik [55]

Answer:

(C) $745

Explanation:

The computation is given below:

For computing the bad debt  expense, first we have to determine the ending account receivable balance which is shown below:

Ending account receivable balance = Beginning account receivable + credit sales - collections - written off amount

= $20,000 + $70,000 - $74,700 - $400

= $15,300

So, the bad debt expense is

= Ending account receivable × given percentage

= $15,300 × 5%

= $745

8 0
3 years ago
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