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## Notes to Consolidated Financial Statements 

The accumulated benefit obligation for all pension plans was $135,950 and $119,070 at May 30, 2004, and May 25, 2003, respectively. The accumulated benefit obligation and fair value of plan assets for pension plans with accumulated benefit obligations in excess of plan assets were $4,881 and $0, respectively, at February 28, 2004, and $4,515 and $0, respectively, at February 28, 2003. The projected benefit obligation for pension plans with projected benefit obligations in excess of plan assets approximated their accumulated benefit obligation at February 28, 2004 and February 28, 2003. 

The following table presents the weighted-average assumptions used to determine benefit obligations and net expense: 

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$^{(1)}$ Determined as of the end of fiscal year. 

$^{(2)}$ Determined as of the beginning of fiscal year. 

We set the discount rate assumption annually for each of the plans at their valuation dates to reflect the yield of high-quality fixed- income debt instruments, with lives that approximate the maturity of the plan benefits. The expected long-term rate of return on plan assets and health care cost trend rates are based upon several factors, including our historical assumptions compared with actual results, an analysis of current market conditions, asset allocations, and the views of leading financial advisers and economists. Our target asset allocation is 35 percent U.S. equities, 30 percent high-quality, long- duration fixed-income securities, 15 percent international equities, 10 percent real assets, and 10 percent private equities. We monitor our actual asset allocation to ensure that it approximates our target allocation and believe that our long-term asset allocation will continue to approximate our target allocation. The defined benefit pension plans have the following asset allocations at their measurement dates of February 28, 2004, and 2003, respectively: 

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Based on an analysis performed in fiscal 2003, we lowered our defined benefit plans’ expected long-term rate of return on plan assets for fiscal 2004 to 9.0 percent, a reduction from its previous level of 10.4 percent. Our historical ten-year rate of return on plan assets, calculated using the geometric method average of returns, is approxi- mately 10.5 percent as of May 30, 2004. 

The discount rate and expected return on plan assets assump- tions have a significant effect on amounts reported for defined benefit pension plans. A quarter percentage point change in the defined ben- efit plans’ discount rate and the expected long-term rate of return on plan assets would increase or decrease earnings before income taxes by $769 and $357, respectively. 

The assumed health care cost trend rate increase in the per- capita charges for benefits ranged from 11.0 percent to 12.0 percent for fiscal 2005, depending on the medical service category. The rates gradually decrease to 5.0 percent through fiscal 2010 and remain at that level thereafter. 

The assumed health care cost trend rate has a significant effect on amounts reported for retiree health care plans. A one-percent- age-point variance in the assumed health care cost trend rate would increase or decrease the total of the service and interest cost compo- nents of net periodic postretirement benefit cost by $341 and $267, respectively, and would increase or decrease the accumulated postre- tirement benefit obligation by $3,572 and $2,805, respectively. 

