Differentiate between a defined contribution pension plan and defined benefit pension plan. Explain how the employer’s obligation differs between the two types of plans.
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1. Differentiate between a defined contribution pension plan and defined benefit pension plan. Explain how the employer’s obligation differs between the two types of plans.
2. What is meant by past service cost? When is past service cost recognized as pension expense?
3. How does an “asset gain or loss” develop in pension accounting?
4. At January 1, 2015, Uddin Company had plan assets of $250,000 and a defined benefit obligation of the same amount. During 2015, service cost was $27,500 ,the discount rate was 10%, actual return on plan assets was $25,000, contributions were $20,000 and benefits paid were $17,500. Prepare a pension worksheet for Uddin Company for 2015.
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- (Pension Expense, Journal Entries) The following information is available for the pension plan of Radcliffe Company for the year 2017. Check the below image for information. Instructions(a) Compute pension expense for the year 2017.(b) Prepare the journal entry to record pension expense and the employer’s contribution to the pension plan in 2017.The following data pertains to a defined benefit (DB) pension plan: defined benefit obligation, December 31, 2015 long-term interest rate on corporate bonds past service cost, December 31, 2016, benefits and liability reduced actuarial revaluation, December 31, 2016, change in mortality assumptions, increased liability actual return on plan assets - 2016 fair value of plan assets, December 31, 2015 funding payment at December 31, 2016 benefits paid to retirees 2016 current service cost - 2016 25,000 10% (1,200) 600 2,100 16,000 4,000 2,000 1,900 Required: 1. Calculate the net defined benefit pension asset/liability at December 31, 2015. 2. For December 31, 2016, calculate the defined benefit obligation, fair value of plan assets and the net defined benefit pension asset or liability. 3. Calculate the three pension accounting elements and journal entries for service cost, net interest and revaluations for 2016.(Pension Expense, Journal Entries) Latoya Company provides the following selected information related to its defined benefit pension plan for 2017. Check the below image for information. Instructions(a) Compute pension expense and prepare the journal entry to record pension expense and the employer’s contribution to the pension plan in 2017. Preparation of a pension worksheet is not required. Benefits paid in 2017 were $35,000.(b) Indicate the pension-related amounts that would be reported in the company’s income statement and balance sheet for 2017.
- See attached picture 1. Determine the components of pension expense that the company would recognize in 2017. (With only one year involved, you need not prepare a worksheet) 2. Prepare the journal entry to record the pension expense and the company's funding of the pension plan in 2017(Computation of Pension Expense) Veldre Company provides the following information about its defined benefit pension plan for the year 2017. Check the below image for following information. InstructionsCompute the pension expense for the year 2017.(Basic Pension Worksheet) The following defined pension data of Rydell Corp. apply to the year 2017. Check the below image for pension data. InstructionsFor 2017, prepare a pension worksheet for Rydell Corp. that shows the journal entry for pension expense and the year-end balances in the related pension accounts.
- Please answer the following questions about defined benefit pension plans: Companies with defined benefit pension plans must recognize pension expenses each period. What are the five components of pension expense? Briefly describe each component. How does each component of pension expense affect pension expense during the period (increase, decrease, or uncertain)? What is the difference between the accumulated pension obligation and the projected pension obligation? What determines whether a pension plan is underfunded or overfunded?Xerox reports the following pension and retiree health care ("Other") footnote as part of its 10-K report. Pension Benefits Retiree Health 2010 2009 2010 2009 (in millions) Change in Benefit Obligation Benefit obligation, January 1 $9,194 $8,495 $1,102 $1,002 Service cost 178 173 B 7 Interest cost 575 508 54 60 Plan participants' contributions 11 9 26 36 Plan amendments [19) 4 (86) 1 Actuarial loss (in) 477 209 13 124 Aquistions 140 1 1 Currency exchange rate changes (154) 373 6 15 (1) Curtailments Benefits paid/settlements Benefit obligation, December 31 Change in Plan Assets Fair value of plan assets, January 1 (670) [578] (118) (143) $9,731 $9,194 $1,006 $1,102 $7,561 $6,923 $- $- Actual return on plan assets 846 720 - Employer contribution 237 122 92 107 Plan participants' contributions 11 9 26 36 Aquistions 107 - - Currency exchange rate changes (144) 349 Benefits paid/settlements (669) 15781 (118) (143) Other (9) 16 Fair value of plan assets, December 31 Net funded status at…The following defined pension data of Doreen Corp. apply to the year 2017. Check the below image for defined pension data. InstructionsFor 2017, prepare a pension worksheet for Doreen Corp. that shows the journal entry for pension expense and the year-end balances in the related pension accounts.
- Jablonski Corp. sponsors a defined benefit pension plan for its employees. On January 1, 2017, the following balances related to this plan. Check the below image for more details for this problem. Instructions(a) Compute pension expense for Jablonski Corp. for the year 2017 by preparing a pension worksheet that shows the journal entry for pension expense.(b) Indicate the pension amounts reported in the financial statements.See attached picture 1. Compute the amount of the 2017 increase/decrease in gains or losses and the amount to be amortized in 2017 and 2018. 2. Indicate the pension amounts reported in the financial statements as of December 31, 2017How do I go about calculating pension payouts to determine a company's financial obligation? Additional info is below: Postretirement BenefitsPeyton Approved has revised its postretirement plan. It will now provide health insurance to retired employees. Management has requested that you report the short- and long-term financial implications of this. The company is currently employing 60, and actuaries estimate that the company has a pension liability of $107,041.70. The estimated cost of retired employees’ health insurance is $43,718.91. Prepare adjusting entries for the pension liability and the health insurance liability