International Paper Company's 2011 annual report disclosed the following post-employment information:
In millions 2011 2010
Change in projected benefit obligation:
Benefit obligation, January 1 $ 425 $ 473
Service cost 2 2
Interest cost 21 23
Participants' contributions 46 48
Actuarial (gain) loss 29 (21)
Benefits paid (108) (110)
Less: Federal subsidy 10 10
Benefit obligation, December 31 $ 425 $ 425
Change in plan assets:
Fair value of plan assets, January 1 $ - $ -
Company contributions 62 62
Participants' contributions 46 48
Benefits paid (108) (110)
Fair value of plan assets, December 31 $ - $ -
a. How much total benefits did former employees receive during the year?
b. What proportion of the obligation is funded? Explain.