JDS Shipyard's projected benefit obligation, accumulated benefit obligation, and plan assets were $95 million, $85 million, and $75 million, respectively, at the end of the year. a. What, if any, pension liability or pension asset must be reported in the balance sheet

A. $20 million

B. $6 million

Explanation:

A.Calculation for pension liability or pension asset that must be reported in the balance sheet

Using this formula

Pension liability=Projected benefit obligation -Plan assets

Where,

Projected benefit obligation =$95 million

Plan assets =$75 million

Let plug in formula

Pension liability =$95 million-$75 million

Pension liability =$20 million

Therefore the  pension liability or pension asset that must be reported in the balance sheet will be $20 million.

B. Calculation for if the plan assets were $89 million instead

Using this formula

Pension liability=Projected benefit obligation -Plan assets

Where,

Projected benefit obligation =$95 million

Plan assets =$89 million

Let plug in formula

Pension liability =$95 million-$89 million

Pension liability =$6 million

Therefore if any, pension liability or pension asset must be reported in the balance sheet if the plan assets were $89 million instead will be $6 million .

it should be

answer; tech (a) is correct;