Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN: 9781337788281
Author: James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher: Cengage Learning
Bartleby Related Questions Icon

Related questions

Question

go.3

answer must be in table format or i will give down vote 

 

Stanley-Morgan Industries adopted a defined benefit pension plan on April 12, 2024. The provisions of the plan were not made
retroactive to prior years. A local bank, engaged as trustee for the plan assets, expects plan assets to earn a 10% rate of return. The
actual return was also 10% in 2024 and 2025.* A consulting firm, engaged as actuary, recommends 6% as the appropriate discount
rate. The service cost is $250,000 for 2024 and $360,000 for 2025. Year-end funding is $260,000 for 2024 and $270,000 for 2025.
No assumptions or estimates were revised during 2024.
We assume the estimated return was based on the actual return on similar investments at the inception of the plan and that, since the
estimate didn't change, that also was the actual rate in 2025.
Required:
Calculate each of the following amounts as of both December 31, 2024, and December 31, 2025:
Note: Enter your answers in thousands (i.e., 200,000 should be entered as 200). Enter a liability as a negative amount.
Answer is not complete.
December 31,
2024
December 31,
2025
1. Projected benefit obligation
$
250
$
625
2. Plan assets
$
260
$
556
3. Pension expense
$
250
4. Net pension asset (liability)
$
(10)
$
69
☑
expand button
Transcribed Image Text:Stanley-Morgan Industries adopted a defined benefit pension plan on April 12, 2024. The provisions of the plan were not made retroactive to prior years. A local bank, engaged as trustee for the plan assets, expects plan assets to earn a 10% rate of return. The actual return was also 10% in 2024 and 2025.* A consulting firm, engaged as actuary, recommends 6% as the appropriate discount rate. The service cost is $250,000 for 2024 and $360,000 for 2025. Year-end funding is $260,000 for 2024 and $270,000 for 2025. No assumptions or estimates were revised during 2024. We assume the estimated return was based on the actual return on similar investments at the inception of the plan and that, since the estimate didn't change, that also was the actual rate in 2025. Required: Calculate each of the following amounts as of both December 31, 2024, and December 31, 2025: Note: Enter your answers in thousands (i.e., 200,000 should be entered as 200). Enter a liability as a negative amount. Answer is not complete. December 31, 2024 December 31, 2025 1. Projected benefit obligation $ 250 $ 625 2. Plan assets $ 260 $ 556 3. Pension expense $ 250 4. Net pension asset (liability) $ (10) $ 69 ☑
Expert Solution
Check Mark
Knowledge Booster
Background pattern image
Similar questions
SEE MORE QUESTIONS
Recommended textbooks for you
Text book image
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:Cengage Learning
Text book image
SWFT Individual Income Taxes
Accounting
ISBN:9780357391365
Author:YOUNG
Publisher:Cengage
Text book image
Individual Income Taxes
Accounting
ISBN:9780357109731
Author:Hoffman
Publisher:CENGAGE LEARNING - CONSIGNMENT