The City of Altoona Pension Trust Fund has assets with an actuarial value of $4,000,000,an actuarial accrued liability of $5,000,000,and an annual covered payroll of $800,000.What is the Pension Trust Fund's funded ratio?

Question

Quizplus · Accepted Answer

The funded ratio is calculated by dividing the actuarial value of assets by the actuarial accrued liability.

Funded ratio = Actuarial value of assets / Actuarial accrued liability

In this case, the funded ratio will be:

Funded ratio = $4,000,000 / $5,000,000 = 0.8 or 80%

Therefore, the best choice is B, 80 percent which represents the percentage of the liabilities that are covered by assets in the fund.

The City of Altoona Pension Trust Fund Has Assets with an Actuarial