Reagan Western Wear, Inc. has a defined benefit pension plan covering its 120 employees. Information relating to the plan follows:

Reagan expects a 10 percent return on its pension fund assets. Compute the difference between the actual return and the expected return and explain how this amount affects net periodic pension cost for 2011.

Question

Reagan Western Wear, Inc. has a defined benefit pension plan covering its 120 employees. Information relating to the plan follows:
  
Reagan expects a 10 percent return on its pension fund assets. Compute the difference between the actual return and the expected return and explain how this amount affects net periodic pension cost for 2011.

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The Answer of Reagan Western Wear, Inc. has a defined benefit pension plan covering its 120 employees. Information relating to the plan follows:
  
Reagan expects a 10 percent return on its pension fund assets. Compute the difference between the actual return and the expected return and explain how this amount affects net periodic pension cost for 2011.