Kaa & Shere Khan Company has a non-contributory, definedbenefit pension plan. Kaa’s incremental borrowing rate is 7%. Theaccounting period ends 31 December 2016. Pension plan data to beused for accounting purposes in 2016 are as follows:

Fair value of plan assets, Dec 31,2015                                      $6,258,000

Defined benefit obligation, Dec 31,2015                                      $7,299,000

Actual return on plan assets for2016                                           $61,100

Actuarial revaluation dated Dec 31,2016                                      $(806,900)

(due to mortality assumptionchanges)

Funding payment at year end2016                                               $250,000

Benefits paid to retirees in2016                                                    $105,000

Current service cost for2016                                                        $233,400  

Required:

1. Calculate the net defined benefit pension liability as of Dec31, 2015.

2. Calculate the net defined benefit pension liability as of Dec31, 2016 by calculating the defined benefit obligation and the fairvalue of plan assets as at Dec 31, 2016.

3. A friend of yours is confused because she cannot find thepension assets or the accrued obligation on Kaa & Shere KhanCompany’s most recent financial statements. She asks you toexplain.