rent year, entity provided the following connection defined benefit plan: Fair value of plan assets Projected benefit obligation Prepaid /accrued benefit cost 10,000,000 (13,000,000) _(3,000,000) The entity revealed the following transactions affecting the plan for the current year: Current service cost 2,500,000 Past service cost - remaining vesting period of covered employees is 5 years Contribution to the plan 1,200,000 3,500,000 Benefits paid to retirees Actual return on plan assets Decrease in projected benefit obligation due to change in actuarial assumptions 3,000,000 1,500,000 400,000 Discount rate 10% Expected return on plan assets 12% REQUIRED: 1. Compute the employee benefit expense for the current year 2. Compute the net re-measurement gain for the current year 3. Compute the fair value of plan assets at year-end 4. Compute the projected benefit obligation at year-end 5. What amount should be reported as accrued or prepaid benefit cost at year-end
rent year, entity provided the following connection defined benefit plan: Fair value of plan assets Projected benefit obligation Prepaid /accrued benefit cost 10,000,000 (13,000,000) _(3,000,000) The entity revealed the following transactions affecting the plan for the current year: Current service cost 2,500,000 Past service cost - remaining vesting period of covered employees is 5 years Contribution to the plan 1,200,000 3,500,000 Benefits paid to retirees Actual return on plan assets Decrease in projected benefit obligation due to change in actuarial assumptions 3,000,000 1,500,000 400,000 Discount rate 10% Expected return on plan assets 12% REQUIRED: 1. Compute the employee benefit expense for the current year 2. Compute the net re-measurement gain for the current year 3. Compute the fair value of plan assets at year-end 4. Compute the projected benefit obligation at year-end 5. What amount should be reported as accrued or prepaid benefit cost at year-end
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:A. At the beginning of current year, an entity provided the following information in connection with a
defined benefit plan:
Fair value of plan assets
Projected benefit obligation
Prepaid /accrued benefit cost
10,000,000
(13,000,000)
(3,000,000)
The entity revealed the following transactions affecting the plan for the current year:
Current service cost
2,500,000
Past service cost - remaining vesting period of covered employees is 5 years
Contribution to the plan
Benefits paid to retirees
Actual return on plan assets
Decrease in projected benefit obligation due to change in actuarial assumptions
1,200,000
3,500,000
3,000,000
1,500,000
400,000
10%
Discount rate
Expected return on plan assets
12%
REQUIRED:
1. Compute the employee benefit expense for the current year
2. Compute the net re-measurement gain for the current year
3. Compute the fair value of plan assets at year-end
4. Compute the projected benefit obligation at year-end
5. What amount should be reported as accrued or prepaid benefit cost at year-end
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