Periodic pension cost
I`m struggling with periodic pension cost calculations and formula and have the following question.
When looking gto the TPPC formula which is total periodic pension cost formula we have:
current service cost + interest cost - actual return on plan assets (+/-) actuarial gains/losses + prior service cost
Current service cost, interest cost, expected return on plan assets (for satisfying pension obligation in the future) and prior service cost are reported in the income statement.
However when solving problems the last component (prior service cost) is not included in the Periodic pension cost calculations.
Do you know why?
Thanks many times,
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