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74
MITSUBISHI MOTORS CORPORATION Annual Report 2007
Pension expenses for MMC and its consolidated subsidiaries’ employees’ retirement defined benefit plans for the
years ended March 31, 2007 and 2006 consisted of the following:
In thousands of
In millions of yen U.S. dollars
2007 2006 2007
Service cost ¥ 9,437 ¥ 9,444 $ 79,942
Interest cost 4,644 4,351 39,342
Expected return on plan assets (3,686) (3,267) (31,225)
Amortization of actuarial losses 2,712 3,102 22,976
Amortization of prior service costs 66 716 567
Others 604 —5,117
Pension expenses ¥13,778 ¥14,347 $116,721
In addition to the above pension expenses, additional retirement benefits of ¥3,073 million ($26,036 thou-
sand) and ¥3,183 million were paid and recorded as other gain (loss), net for the years ended March 31, 2007
and 2006, respectively.
Pension expenses of consolidated subsidiaries, which adopt the simplified method, are included in service cost.
18. Income Taxes
MMC and its domestic consolidated subsidiaries are subject to corporate, resident and enterprise taxes based on their
taxable income. Income taxes of the foreign consolidated subsidiaries are generally calculated based on the tax rates
applicable in their countries of incorporation. The consolidated tax payment system is applied at March 31, 2007 and
2006.
The effective tax rates reflected in the accompanying consolidated statements of operations for the year ended
March 31, 2007 differ from the statutory tax rate for the following reasons:
(%)
2007 2006
Statutory income tax rate for MMC 40.3
Change in valuation allowance, effect of
using loss carry forwards and similar items 18.5
Dividends received (exclusion from gross income) (5.7)
Others 0.2
Income taxes as a percentage of income before income taxes
and minority interest 53.3
Due to loss before income
taxes and minority interest,
the information is omitted
from the notes.