FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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JDS Shipyard’s projected benefit obligation, accumulated benefit obligation, and plan assets were $40 million, $30 million, and $25 million, respectively, at the end of the year. What, if any, pension liability must be reported in the
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- Pharoah Corp. has the following beginning-of-the-year present values for its projected benefit obligation and market-related values for its pension plan assets. Projected Plan Assets Value Benefit Obligation 2019 $2,320,000 $2,204,000 2020 2,784,000 2,900,000 2021 3,422,000 3,016,000 2022 4,176,000 3,480,000 The average remaining service life per employee in 2019 and 2020 is 10 years and in 2021 and 2022 is 12 years. The net gain or loss that occurred during each year is as follows: 2019, $324,800 loss; 2020, $104,400 loss; 2021, $12,760 loss; and 2022, $29,000 gain. (In working the solution, the gains and losses must be ted to arrive at year-end balances.) Using the corridor approach, compute the amount of net gain or loss amortized and charged to pension expense in each of the four years, setting up an appropriate schedule. Year Minimum Amortization of Los 2019 24 2020 2$ 2021 2$ 2022 2$arrow_forwardthe warren groups pension expense is 78 million. the amount includes a 46 million service cost, a 60 million interest cost, a 34 million reduction for the expected return on plan assets, and a 6 million amoritization of a prior service cost. prepare the journal entry to record the pension expense?arrow_forwardHarrison Forklift's pension expense includes a service cost of $12 million. Harrison began the year with a pension liability of $32 million (underfunded pension plan). 1. Interest cost, $8; expected return on assets, $6; amortization of net loss, $2. 2. Interest cost, $8; expected return on assets, $6; amortization of net gain, $2. 3. Interest cost, $8; expected return on assets, $6; amortization of net loss, $2; amortization of prior service cost, $3 million. Required: Prepare the appropriate general journal entries to record Harrison's pension expense in each of the above independent situations regarding the other (non-service cost) components of pension expense ($ in millions): (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions. (i.e., 10,000,000 should be entered as 10).) Journal entry worksheet 1. Prepare the appropriate journal entry to record pension expense in situation 1 above. 2.…arrow_forward
- The projected benefit obligation was $400 million at the beginning of the year and $429 million at the end of the year. At the end of the year, pension benefits paid by the trustee were $18 million and there were no pension-related other comprehensive income accounts. The actuary’s discount rate was 5%. What was the amount of the service cost for the year?arrow_forwardAt January 1, 2020, Windsor Company had plan assets of $303,400 and a projected benefit obligation of the same amount. During 2020, service cost was $26,700, the settlement rate was 10%, actual and expected return on plan assets were $24,500, contributions were $19,700, and benefits paid were $16,900.Prepare a pension worksheet for Windsor Company for 2020. WINDSOR COMPANY General Journal Entries Memo Record Items PensionExpense Cash PensionAsset/Liability ProjectedBenefitObligation PlanAssets 1/1/20 $enter a dollar amount select a debit or credit $enter a dollar amount select a debit or credit $enter a dollar amount select a debit or credit $enter a dollar amount select a debit or credit…arrow_forwardCalculating Pension Expense Stars Inc. has a noncontributory defined pension plan for its employees. During 2020, the company had service cost of $90,000, an expected return on plan assets of $13,920, amortization of prior service cost of $3,000, amortization of net pension loss of $3,333, and benefits paid to employees of $60,000. The January 1, 2020, balance in its projected benefit obligation was $291,000. The discount rate is 10%. Required Calculate pension expense for 2020. $Answerarrow_forward
- At January 1, 2025, Crane Company had plan assets of $254,500 and a projected benefit obligation of the same amount. During 2025, service cost was $26,600, the settlement rate was 10%, actual and expected return on plan assets were $24,500, contributions were $20,800, and benefits paid were $16,800. Prepare a pension worksheet for Crane for 2025.arrow_forwardThe projected benefit obligation was $80 million at the beginning of the year and $85 million at the end of the year. Service cost for the year was $10 million. At the end of the year, there were no pension-related other comprehensive income accounts. The actuary’s discount rate was 5%. What was the amount of the retiree benefits paid by the trustee?arrow_forwardAssume that at the beginning of the current year, a company has a net gain-AOCI of $25,600,000. At the same time, assume the PBO and the plan assets are $222,400,000 and $153,500,000, respectively. The average remaining service period for the employees expected to receive benefits is 10 years. What is the amount of amortization to pension expense for the year? $1,968,000. $344,000. $336,000. $689,000.arrow_forward
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