The following data are available pertaining to Household Appliance Company's retiree health care plan for 2024: Number of employees covered Years employed as of January 1, 2024 2 3 [each] 25 years Attribution period Expected postretirement benefit obligation, January 1 Expected postretirement benefit obligation, December 31 Interest rate Funding Required: 1. What is the accumulated postretirement benefit obligation at the beginning of 2024? 2. What is interest cost to be included in 2024 postretirement benefit expense? 3. What is service cost to be included in 2024 postretirement benefit expense? 4. Prepare the journal entry to record the postretirement benefit expense for 2024. $ 50,000 $ 53,000 6 % none

The following data are available pertaining to Household Appliance Company's retiree health care plan for 2024: Number of employees covered Years employed as of January 1, 2024 2 3 [each] 25 years Attribution period Expected postretirement benefit obligation, January 1 Expected postretirement benefit obligation, December 31 Interest rate Funding Required: 1. What is the accumulated postretirement benefit obligation at the beginning of 2024? 2. What is interest cost to be included in 2024 postretirement benefit expense? 3. What is service cost to be included in 2024 postretirement benefit expense? 4. Prepare the journal entry to record the postretirement benefit expense for 2024. $ 50,000 $ 53,000 6 % none

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Herring Wholesale Company has a defined benefit pension plan. On January 1, 2024, the following pension related data were available: Net gain-AOCI Accumulated benefit obligation Projected benefit obligation Fair value of plan assets Average remaining service period of active employees (expected to remain constant for the next several years) 1. Amount amortized to 2024 pension expense 2. Pension expense 3. Net gain ($ in thousands) $ 349 3,070 3,100 2,600 The rate of return on plan assets during 2024 was 9%, although it was expected to be 10%. The actuary revised assumptions regarding the PBO at the end of the year, resulting in a $42,000 decrease in the estimate of that obligation. Required: 1. Calculate any amortization of the net gain that should be included as a component of net pension expense for 2024. 2. Assume the net pension expense for 2024, not including the amortization of the net gain component, is $344,000. What is pension expense for the year? 3. Determine the net…
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How 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
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