justin88

There are two ways two calculate Economic Pension Expense:
1. Economic Pension expense = service cost + interest cost - actual return.
2. Change in Funded Status - Employer contribution.
As for when to use actual return and expected return, I think you always have to use expected return to calculate Pension Expense on Income Statement else the expense would be too volatile. In contrast, you have to use actual return to calculate PBA. Could anyone confirm this?