The following data are for the pension plan for the employees of Lockett Company 1/1/14 12/31/14 12/31/15 Accumulated benefit obligation $2,500,000 $2,600,000 $3,400,000 Projected benefit obligation 2,700,000 2,800,000 3,700,000 Plan assets (at fair value) 2,300,000 3,000,000 3,300,000 AOCL - net loss 0 580,000 500,000 Settlement rate (for year) 10% 9% Expected rate of return (for year) 8% 7% Lockett's contribution was $420,000 in 2015 and benefits paid were $275,000. Lockett estimates that the average remaining service life is 20 years. The actual return on plan assets in 2015 was $155,000 Assume that the actual return on plan assets in 2015 was $245,000. The unexpected gain on plan assets in 2015 was a. 32,000 b. 55,000 c. 35,000 d. 34,000 The corridor for 2015 was $300,000. The amount of AOCI-net loss amortized in 2015 was a. $33,333 b. $32,000 c. $14,000 d. $12,000
The following data are for the pension plan for the employees of Lockett Company 1/1/14 12/31/14 12/31/15 Accumulated benefit obligation $2,500,000 $2,600,000 $3,400,000 Projected benefit obligation 2,700,000 2,800,000 3,700,000 Plan assets (at fair value) 2,300,000 3,000,000 3,300,000 AOCL - net loss 0 580,000 500,000 Settlement rate (for year) 10% 9% Expected rate of return (for year) 8% 7% Lockett's contribution was $420,000 in 2015 and benefits paid were $275,000. Lockett estimates that the average remaining service life is 20 years. The actual return on plan assets in 2015 was $155,000 Assume that the actual return on plan assets in 2015 was $245,000. The unexpected gain on plan assets in 2015 was a. 32,000 b. 55,000 c. 35,000 d. 34,000 The corridor for 2015 was $300,000. The amount of AOCI-net loss amortized in 2015 was a. $33,333 b. $32,000 c. $14,000 d. $12,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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The following data are for the pension plan for the employees of Lockett Company
| 1/1/14 | 12/31/14 | 12/31/15 | |
| Accumulated benefit obligation | $2,500,000 | $2,600,000 | $3,400,000 |
| Projected benefit obligation | 2,700,000 | 2,800,000 | 3,700,000 |
| Plan assets (at fair value) | 2,300,000 | 3,000,000 | 3,300,000 |
| AOCL - net loss | 0 | 580,000 | 500,000 |
| Settlement rate (for year) | 10% | 9% | |
| Expected |
8% | 7% |
Lockett's contribution was $420,000 in 2015 and benefits paid were $275,000. Lockett estimates that the average remaining service life is 20 years.
The actual return on plan assets in 2015 was $155,000
Assume that the actual return on plan assets in 2015 was $245,000. The unexpected gain on plan assets in 2015 was
a. 32,000
b. 55,000
c. 35,000
d. 34,000
The corridor for 2015 was $300,000. The amount of AOCI-net loss amortized in 2015 was
a. $33,333
b. $32,000
c. $14,000
d. $12,000
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