Gurung Co. has a noncontributory, defined benefit pension plan adopted on 1 January 20X5. On 31 December 20X5, the following information is available: For accounting purposes Interest rate used for pension amounts, 5%. Past service cost, granted as of 1 January 20X5, $360,000. This is also the defined benefit obligation on 1 January. Current service cost for 20X5, appropriately measured for accounting purposes, $83,000. For funding purposes Funding was $107,500 in 20X5 for all pension amounts. The payment was made on 31 December. Actual earnings on fund assets, zero. Required: 1. Prepare a pension spreadsheet that summarizes relevant pension data for 20X5. Answer is complete and correct. Pension Obligation Plan Assets Pension Expense Net Pension Asset/Liab. Accumulated OCI 20X5 Beginning - PSC $ 360,000 $ 0 $ 360,000 $ 0 $ 0 CSC 83,000 0 83,000 0 0 Interest 18,000 0 18,000 0 0 0 $ 461,000 461,000 0 Funding 107,500 107,500 0 $ 461,000 $ 107,500 $ 353,500 0 Pension Question Sophia Consultants Inc. has had a defined benefit pension plan since January 1, 2018. The following represents beginning balances as at January 1, 2022: Plan Asset $1,155,300; Defined Benefit Obligation $1,275,000; Net Pension Liability $119,700 Additional Information is as follows for 2022: Current Service cost is $186,000 for 2022 Company Funding/Contribution is $200,000 for 2022. Funding is made on December 31 of each year. Actual return on assets is $55,900 for 2022. There is an increase in obligation for $29,000 due to changes in Actuarial assumptions at Dec 31, 2022. There are payments made equal to $80,000 per year to retired employees in 2022 (payments to retirees are made at the end of the year on December 31). Past service cost of $85,900 from plan amendment dated December 31, 2022: liability is increased because benefits were increased on a retroactive basis. For 2022, the assumed interest rate is 6%. Assume IFRS. Required: 1. Determine Defined Benefit Obligation, Pension Asset, Pension Expense, AOCI, and Net Pension Asset/Liability for 2022. Prepare a spreadsheet to determine all these pension items. 2. Prepare the required journal entries for 2022. 3. Prepare a partial balance sheet and a partial income statement for 2022.

Gurung Co. has a noncontributory, defined benefit pension plan adopted on 1 January 20X5. On 31 December 20X5, the following information is available: For accounting purposes Interest rate used for pension amounts, 5%. Past service cost, granted as of 1 January 20X5, $360,000. This is also the defined benefit obligation on 1 January. Current service cost for 20X5, appropriately measured for accounting purposes, $83,000. For funding purposes Funding was $107,500 in 20X5 for all pension amounts. The payment was made on 31 December. Actual earnings on fund assets, zero. Required: 1. Prepare a pension spreadsheet that summarizes relevant pension data for 20X5. Answer is complete and correct. Pension Obligation Plan Assets Pension Expense Net Pension Asset/Liab. Accumulated OCI 20X5 Beginning - PSC $ 360,000 $ 0 $ 360,000 $ 0 $ 0 CSC 83,000 0 83,000 0 0 Interest 18,000 0 18,000 0 0 0 $ 461,000 461,000 0 Funding 107,500 107,500 0 $ 461,000 $ 107,500 $ 353,500 0 Pension Question Sophia Consultants Inc. has had a defined benefit pension plan since January 1, 2018. The following represents beginning balances as at January 1, 2022: Plan Asset $1,155,300; Defined Benefit Obligation $1,275,000; Net Pension Liability $119,700 Additional Information is as follows for 2022: Current Service cost is $186,000 for 2022 Company Funding/Contribution is $200,000 for 2022. Funding is made on December 31 of each year. Actual return on assets is $55,900 for 2022. There is an increase in obligation for $29,000 due to changes in Actuarial assumptions at Dec 31, 2022. There are payments made equal to $80,000 per year to retired employees in 2022 (payments to retirees are made at the end of the year on December 31). Past service cost of $85,900 from plan amendment dated December 31, 2022: liability is increased because benefits were increased on a retroactive basis. For 2022, the assumed interest rate is 6%. Assume IFRS. Required: 1. Determine Defined Benefit Obligation, Pension Asset, Pension Expense, AOCI, and Net Pension Asset/Liability for 2022. Prepare a spreadsheet to determine all these pension items. 2. Prepare the required journal entries for 2022. 3. Prepare a partial balance sheet and a partial income statement for 2022.

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 6E

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