3The following data are available pertaining to Firewall Corporation's retiree health plan for 2021:Number of employees coveredYears employed as of January 1, 2021Attribution periodEPBO, January 1EPBQ, December 31Interest rateFunding45 (each)20 years$112,000$123,20010%noneRequired:1. What is the APBO at the beginning of 2021?2. What is the interest cost for 2021?3. What is service cost for 2021?4. Prepare the journal entry to record the postretirement benefit expense for 2021.Complete this question by entering your answers in the tabs below.Req 1 to 3Req 4What is the APBO at the beginning, interest cost and service cost for 2021?1. APBO2. Interest cost3. Service costReq 1 to 3Req 4>

Answered: 3 The following data are available…

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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The following Incomplete (columns have missing amounts) pension spreadsheet is for the current year for First Republic Corporation (FRC). ($ in millions) Debit (Credit) Beginning balance Service cost Interest cost Expected return on assets Gain/loss on assets Amortization of: Prior service cost Net gain/loss Loss on PBO Contributions to fund Retiree benefits paid Ending balance What was the actuary's Interest (discount) rate? Multiple Choice O 17% PBO (300) (12) Prior Plan Service Net Pension Net Pension Assets Cost (Gain)/Loss Expense Cash (Liability)/Asset 43 (185) 83 (88) 866 (11) (5) 6 (96) 77 51 (60)
Current Attempt in Progress The actuary for the pension plan of Bridgeport Inc. calculated the following net gains and losses. Incurred during the Year 2020 2021 2022 2023 As of January 1, Other information about the company's pension obligation and plan assets is as follows. 2020 2021 2022 2023 2020 2021 2022 2023 Projected Benefit Obligation Save for Later (Gain) or Loss $298,100 478,900 $ (210,400) (288,600) Year Minimum Amortization of (Gain) Loss $ Bridgeport Inc. has a stable labor force of 400 employees who are expected to receive benefits under the plan. The total service-years for all participating employees is 4,800. The beginning balance of accumulated OCI (G/L) is zero on January 1, 2020. The market- related value and the fair value of plan assets are the same for the 4-year period. Use the average remaining service life per employee as the basis for amortization. $ Compute the minimum amount of accumulated OCI (G/L) amortized as a component of net periodic pension expense…
Current Attempt in Progress Cullumber Corp. sponsors a defined benefit pension plan for its employees. On January 1, 2025, the following balances relate to this plan. Plan assets Projected benefit obligation Pension asset/liability Accumulated OCI (PSC) $465,800 604,200 138,400 95,000 Dr. As a result of the operation of the plan during 2025, the following additional data are provided by the actuary. (a) Service cost Settlement rate, 10% Actual return on plan assets Amortization of prior service cost Expected return on plan assets Unexpected loss from change in projected benefit obligation, due to change in actuarial predictions Contributions Benefits paid retirees $86,600 55,000 19,300 52,000 79,600 102,800 88,300 Using the data above, compute pension expense for Cullumber. for the year 2025 by preparing a pension worksheet. (Enter all amounts as positive)
4) Electronic Distribution has a defined benefit pension plan. Characteristics of the plan during 2021 are as follows: ($ millions) PBO balance, January 1 $ 480 Plan assets balance, January 1 350 Service cost 75 Interest cost 45 Gain from change in actuarial assumption 26 Benefits paid (36 ) Actual return on plan assets 23 Contributions 2021 65 The expected long-term rate of return on plan assets was 8%. There were no AOCI balances related to pensions on January 1, 2021, but at the end of 2021, the company amended the pension formula, creating a prior service cost of $13 million. (Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) Required: 1. Calculate the pension expense for 2021.2. Prepare the journal entries to record (a) pension expense, (b) gains or losses, (c) prior service cost, (d) funding, and (e) payment of benefits for 2021.3. What amount will Electronic Distribution report in…
The following information relates to the pension plan for the employees of Blossom Co.: Accum, beneht obligation Projected benefit obligation Fair value of plan assets AOCI - net (gain) or loss Settlement rate (for year) Expected rate of return (for year) 1/1/20 The corridor for 2021 is $10240000 10765000 9925000 -0- 12/31/20 $10660000 11458000 11920000 (1612000) 9% 9% 12/31/21 $ 13600000 15007000 13054000 (1780000) 9% 8% Blossom estimates that the average remaining service life is 16 years. Blossom's contribution was $1423000 in 2021 and benefits paid were $1087000.
Data pertaining to the postretirement health care benefit plan of Sterling Properties include the following for 2021: Service cost Accumulated postretirement benefit obligation, January 1 Plan assets (fair value), January 1 Prior service cost-AOCI Net gain-AOCI (2021 amortization, $2) Retiree benefits paid (end of year) Contribution to health care benefit fund (end of year) Discount rate, 8% Return on plan assets (actual and expected), 10% Required: 1. Determine the postretirement benefit expense for 2021. 2. Prepare the appropriate journal entries to record the (a) postretirement benefit expense, (b) funding, and (c) retiree benefits for 2021. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Determine the postretirement benefit expense for 2021. (Amounts to be deducted should be indicated with a minus sign. Enter your answers in thousands.) Postretirement benefit expense ($ in thousands) $ ($ in thousands) $ 136 700 30 none 100 88 200
The following information relates to the pension plan for the employees of Cullumber Company: Accum. benefit obligation Projected benefit obligation Fair value of plan assets AOCI - net (gain) or loss Settlement rate (for year) Expected rate of return (for year) The corridor for 2026 is 1/1/25 $1102000. $1073600. $1410700. $1212200. $9340000 9865000 9025000 0 12/31/25 $9760000 10558000 11020000 (1522000) 11% 8% 12/31/26 $12700000 14107000 12154000 (1690000) 11% Cullumber estimates that the average remaining service life is 16 years. Cullumber's contribution was $1323000 in 2026 and benefits paid were $987000. 7%
The following information is available for the pension plan of Sunland Company for the year 2020. Actual and expected return on plan assets $ 14,700 Benefits paid to retirees 40,800 Contributions (funding) 81,100 Interest/discount rate 10 % Prior service cost amortization 7,600 Projected benefit obligation, January 1, 2020 458,000 Service cost 63,900
Electronic Distribution has a defined benefit pension plan. Characteristics of the plan during 2024 are as follows: ($ millions) $470 300 PBO balance, January 1 Plan assets balance, January 1 Service cost Interest cost Gain from change in actuarial assumption Benefits paid Actual return on plan assets Contributions 2024 The expected long-term rate of return on plan assets was 6%. There were no AOCI balances related to pensions on January 1, 2024, but at the end of 2024, the company amended the pension formula, creating a prior service cost of $12 million. Required: 1. Calculate the pension expense for 2024. 2. Prepare the journal entries to record (a) pension expense, (b) gains or losses, (c) prior service cost, (d) funding, and (e) payment of benefits for 2024. 3. What amount will Electronic Distribution report in its 2024 balance sheet as a net pension asset or net pension liability? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3…
Exercise 17-25 (Algo) Postretirement benefits; determine APBO, service cost, interest cost; prepare journal entry [LO17-10, 17-11] 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 Attribution period 2 2 [each] 25 years 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? $ 56,000 $ 58,800 5% none
Hicks Cable Company has a defined benefit pension plan. Three alternative possibilities for pension-related data at January 1, 2024, are shown below. Net loss (gain)-AOCI, January 1 2024 loss (gain) on plan assets 2024 loss (gain) on PBO Accumulated benefit obligation, January 1 Projected benefit obligation, January 1 Fair value of plan assets, January 1 Average remaining service period of active employees (years) Required: ($ in thousands) Case 1 Case 2 Case 3 $ 340 $ (410) 281 (31) (28) 6 (43) 36 (3,150) (2,750) (290) (1,650) (3,510) (2,870) 3,000 2,900 (1,900) 1,750 10 12 7 1. For each independent case, calculate any amortization of the net loss or gain that should be included as a component of pension expense for 2024. 2. For each independent case, determine the net loss-AOCI or net gain-AOCI as of January 1, 2025.
The following data are available pertaining to Household Appliance Company's retiree health care plan for 2021: Number of employees covered 2 Years employed as of January 1, 2021 3 [each] Attribution period 20 years Expected postretirement benefit obligation, Jan. 1 $ 60,000 Expected postretirement benefit obligation, Dec. 31 $ 63,000 Interest rate 5 % Funding none Required:1. What is the accumulated postretirement benefit obligation at the beginning of 2021?2. What is interest cost to be included in 2021 postretirement benefit expense?3. What is service cost to be included in 2021 postretirement benefit expense?4. Prepare the journal entry to record the postretirement benefit expense for 2021.

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