Can someone decode the change of $93 completely. It’s one impact will come in Debt ie increase in debt by 93 but what will be the other effect of 93
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The estimate of a company’s pension liability affects several components of periodic pension costs, apart from actuarial gains and losses. First, the service cost component of annual pension cost is essentially the amount by which the pension liability increases as a result of the employees’ service during the year ( So the higher benefit obligation of 93 would be reflected in the service cost component). Second, the interest expense component of annual pension cost is based on the amount of the liability ( A higher benefit obligation would force a higher interest expense/net interest expense). Third, the past service cost component of annual pension cost is the amount by which the pension liability increases because of changes to the plan.