Sheridan Ltd. initiated a one-person pension plan in January 2015 that promises the employee a...
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Sheridan Ltd initiated a oneperson pension plan in January that promises the employee a pension on retirement according to the following formula: pension benefit of final salary per year of service after the plan initiation. The employee began employment with Sheridan early in at age and expects to retire at the end of the year in which he turns His life expectancy at that time is years.
Assume that this employee earned an annual salary of $ when he joined Sheridan, that his salary was expected to increase at a rate of per year, and that this remains a reasonable assumption to date. Sheridan considers a discount rate of to be appropriate.
a
X Your answer is incorrect.
What is the employee's expected final salary? Round your answer to decimal places, eg
b what amount of current service cost should Sheridan recoginze relative to this plan?
c what is the amount of the defined benefit obligation?
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