A president of JR and RJ Corporation shall receive a 20% retirement benefit based on the final salary per year for a period of 3 years. The president does not contribute to the plan. The discount rate to be used is 5%. The projected salary over three years (2020, 2021, 2022) are P500,000, P600,000, and P720,000, respectively. PV@ 5% for one period, 0.9524 PV@ 5% for two periods, 0.9070 1. What is the annual benefit to be used in computing the estimated pension liability? 2. What is the estimated pension liability as of December 31, 2021 using the projected unit credit method?
A president of JR and RJ Corporation shall receive a 20% retirement benefit based on the final salary per year for a period of 3 years. The president does not contribute to the plan. The discount rate to be used is 5%. The projected salary over three years (2020, 2021, 2022) are P500,000, P600,000, and P720,000, respectively. PV@ 5% for one period, 0.9524 PV@ 5% for two periods, 0.9070 1. What is the annual benefit to be used in computing the estimated pension liability? 2. What is the estimated pension liability as of December 31, 2021 using the projected unit credit method?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
A president of JR and RJ Corporation shall receive a 20% retirement benefit based on the final salary per year for a period of 3 years. The president
does not contribute to the plan. The discount rate to be used is 5%. The projected salary over three years (2020, 2021, 2022) are P500,000, P600,000, and P720,000, respectively. PV@ 5% for one period, 0.9524 PV@ 5% for two periods, 0.9070
1. What is the annual benefit to be used in computing the estimated pension liability?
2. What is the estimated pension liability as of December 31, 2021 using the projected unit credit method?
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education