Question textNet interest cost is a component of pensionexpense under IFRS. How is net interest costcalculated?Select one:а.Interest expense on the defined benefitobligation (DBO), net of expected interestincome earned on plan assets.b.The increase in the DBO over the period, netof the increase in the plan assets over theperiod.С.Interest expense on the DBO, net of actualinterest income earned on plan assets.d.The increase in the DBO over the period, netof the increase in the plan assets over theperiod. Question textGreat Cosmetics Corp., a company reporting under IFRS,has a defined benefit pension plan. Pension informationconcerning the 2019 and 2020 fiscal years is presentedbelow (in millions):Information provided by the pension plan actuaryDefined benefit obligation (DBO),$2,000December 31, 2019Past service cost (PSC) from a plan400amendment made January 2, 2020Current service cost (CSC) for 20205202020 interest cost on DBO, based on 10%180discount rate2020 actuarial gain on DBO arising from a250change in estimateBenefits paidFunding for the yearInformation provided by the pension plan trusteeFair value of plan assets, January 1, 2020$1,800Actual return on plan assets180What is the net defined benefit liability/asset balanceon the balance sheet at January 1, 2020?Select one:а.$200 net defined benefit liability.b.$200 net defined benefit asset.C.$2,000 net defined benefit liability.d.$3,800 net defined benefit asset.

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Question text Net interest cost is a component of pension expense under IFRS. How is net interest cost calculated? Select one: а. Interest expense on the defined benefit obligation (DBO), net of expected interest income earned on plan assets. b. The increase in the DBO over the period, net of the increase in the plan assets over the period. С. Interest expense on the DB0, net of actual interest income earned on plan assets. d. The increase in the DBO over the period, net of the increase in the plan assets over the period.

Question text Net interest cost is a component of pension expense under IFRS. How is net interest cost calculated? Select one: а. Interest expense on the defined benefit obligation (DBO), net of expected interest income earned on plan assets. b. The increase in the DBO over the period, net of the increase in the plan assets over the period. С. Interest expense on the DB0, net of actual interest income earned on plan assets. d. The increase in the DBO over the period, net of the increase in the plan assets over the period.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter19: Accounting For Post Retirement Benefits

Section: Chapter Questions

Problem 7MC: Which of the following is not a component of pension expense? a. amount funded b. service cost c....

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Net interest cost is a component of pension expense under IFRS. How is net interest cost calculated? Select one: O a. The increase in the DBO over the period, net of the increase in the plan assets over the period. O b. Interest expense on the DBO, net of actual interest income earned on plan assets. O c. Interest expense on the defined benefit obligation (DBO), net of expected interest income earned on plan assets. O d. The increase in the DBO over the period, net of the increase in the plan assets over the period.
The net pension liability (PBO minus plan assets) is increased by: A. Service cost. B. Expected return on plan assets. C. Amortization of prior service cost. D. Cash contributions to plan assets.
Question text The computation of pension expense includes all the following except Select one: 13 a. interest on plan assets b. all of these are included C. service cost component measured using current salary levels. d. interest on defined benefit obligation.
Which component of Kensington’s periodic pension cost would be shown in OCI ratherthan P&L?A . Service costB . Net interest (income) expenseC . Remeasurements
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For a defined benefit pension plan, pension expense consists of five components, for which the formula is Service Cost – Interest Cost + Expected Return on Plan Assets – Amortization of Prior Service Cost +(–) Gain (Loss). Service Cost + Interest Cost – Expected Return on Plan Assets + Amortization of Prior Service Cost +(–) Gain (Loss). Service Cost + Interest Cost + Expected Return on Plan Assets – Amortization of Prior Service Cost +(–) Gain (Loss). Service Cost – Interest Cost + Expected Return on Plan Assets + Amortization of Prior Service Cost +(–) Gain (Loss).
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Interest cost included in pension expense recognized for a period by an employer sponsoring a defined benefit pension plan represents the shortage between the expected and actual returns on plan assets. increase in the projected benefit obligation due to the passage of time increase in the fair value of plan assets due to the passage of time. amortization of the discount on accumulated OCI (PSC) 0
The return on plan assets is the increase in plan assets (at fair value), adjusted for contributions to the plan and benefits paid during the period. How is the return included in the calculation of the periodic pension expense?
In computing the interest component of pension expense, what interest rates may be used?