The following pension information was disclosed by PACCAR Inc. in its 2016 annual report:
Required:
a. What is "service cost"? How does it affect PACCAR's total pension expense for the year?
b. PACCAR reports an actuarial loss of $186.4 million for 2016. What is this loss and how does PACCAR account for it?
c. How much did PACCAR contribute to the pension plan during the year?
d. What amount of pension benefits were paid to former PACCAR employees during the year?
e. Explain the funded status of the pension plan in 2016 and compare it to the funded status in 2015. Are these amounts significant?

Question

The following pension information was disclosed by PACCAR Inc. in its 2016 annual report:
  Required: 
a. What is "service cost"? How does it affect PACCAR's total pension expense for the year?
b. PACCAR reports an actuarial loss of $186.4 million for 2016. What is this loss and how does PACCAR account for it?
c. How much did PACCAR contribute to the pension plan during the year?
d. What amount of pension benefits were paid to former PACCAR employees during the year?
e. Explain the funded status of the pension plan in 2016 and compare it to the funded status in 2015. Are these amounts significant?

Quizplus · Accepted Answer

The Answer of The following pension information was disclosed by PACCAR Inc. in its 2016 annual report:
  Required: 
a. What is "service cost"? How does it affect PACCAR's total pension expense for the year?
b. PACCAR reports an actuarial loss of $186.4 million for 2016. What is this loss and how does PACCAR account for it?
c. How much did PACCAR contribute to the pension plan during the year?
d. What amount of pension benefits were paid to former PACCAR employees during the year?
e. Explain the funded status of the pension plan in 2016 and compare it to the funded status in 2015. Are these amounts significant?

The Following Pension Information Was Disclosed by PACCAR Inc