Question

At the end of 2021, Havana contributed $696 thousand to the pension fund and benefit payments of $624 thousand were made to retirees. The expected rate of return on plan assets was 10%, and the actuary's discount rate is 8%. There were no changes in actuarial estimates and assumptions regarding the PBO.

What is Havana's 2016 actual return on plan assets?

Answer 1

Havana's 2016 actual return on plan asset is $504 thousand.

Step-by-step explanation:

Havana's 2016 actual return on plan asset is $504 thousand.

Let actual return be x.

Ending balance of plan assets = Beginning balance of plan asset + Actual return + Cash Contributions - Retiree benefits

$6,336 = $5,760 + x + $696 - $624

x = $6,336 - $5,760 - $696 + $624

x= $504 (answer).