What is the total pension expense for the following plan after 5 years? "The plan requires the company to contribute $500 for each of its 1,000 employees. The plan hopes to accumulate enough funds so that each retiree receives $20,000 in the future; the company has no obligation to guarantee the investment returns."

Question

Quizplus · Accepted Answer

The total pension expense is calculated by multiplying the contribution per employee by the number of employees and the number of years: $500 * 1,000 employees * 5 years = $2,500,000.

What Is the Total Pension Expense for the Following Plan