At January 1, 2020, Van Gogh Corp.'s defined benefit pension plan, under IFRS, had a defined benefit obligation of $ 100,000, while the fair value of the plan assets was $ 120,000. During 2020, the plan's current service cost was $ 150,000; past service costs were $ 80,000; Van Gogh contributed $ 110,000 to the plan; the actual and expected return on the plan assets was $9,000; and benefits paid to retirees were $ 95,000. If the net interest cost was $10,000, what is the defined benefit obligation at December 31, 2020? A) $ 110,000 OB) $144,000 C) $ 235,000 D) $254,000

At January 1, 2020, Van Gogh Corp.'s defined benefit pension plan, under IFRS, had a defined benefit obligation of $ 100,000, while the fair value of the plan assets was $ 120,000. During 2020, the plan's current service cost was $ 150,000; past service costs were $ 80,000; Van Gogh contributed $ 110,000 to the plan; the actual and expected return on the plan assets was $9,000; and benefits paid to retirees were $ 95,000. If the net interest cost was $10,000, what is the defined benefit obligation at December 31, 2020? A) $ 110,000 OB) $144,000 C) $ 235,000 D) $254,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Manno Corporation has the following information available concerning its defined-benefit pension plan for 2020. Service cost Contributions Interest cost Actual return on plan assets Expected return on plan assets Prior service cost amortization Benefits paid Compute Manno's 2020 pension expense. $40,000 50,000 47,400 25,000 26,900 35,000 100,000
Pendulum Enterprises has a defined benefit plan. Employees receive a pension equal to 2% of the average of the highest 5 years of salary and based on years of service. On December 31 2020, the fair value of the pension assets in the plan is $10.7 M, although pension contributions were in excess of $12.5 M, and the estimated pension obligation is $12.3M. By how much is the plan over or underfunded? (place answer without $ sign in the space below in millions of dollars at up to 2 decimal places) 신
Larkspur Corporation amended its pension plan on January 1, 2020, and granted $138,240 of prior service costs to its employees. The employees are expected to provide 1,920 service years in the future, with 330 service years in 2020.Compute prior service cost amortization for 2020. Prior service cost amortization for 2020 $enter the prior service cost amortization for 2017 in dollars
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 $380,000 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. 1.…
At December 31, 2020, Metlock Corporation had a projected benefit obligation of $504,700, plan assets of $342,200, and prior service cost of $128,700 in accumulated other comprehensive income.Determine the pension asset/liability at December 31, 2020.
Stanley-Morgan Industries adopted a defined benefit pension plan on April 12, 2021. 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 2021 and 2022.* A consulting firm, engaged as actuary, recommends 5% as the appropriate discount rate. The service cost is $140,000 for 2021 and $220,000 for 2022. Year-end funding is $150,000 for 2021 and $160,000 for 2022. No assumptions or estimates were revised during 2021. * 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 2022. Required: Calculate each of the following amounts as of both December 31, 2021, and December 31, 2022: (Enter your answers in thousands (i.e., 200,000 should be entered as 200).) 1. Projected benefit obligation 2. Plan assets 3.…
Pharoah Corp. has the following beginning-of-the-year present values for its projected benefit obligation and market-related values for its pension plan assets. Projected Plan Assets Value Benefit Obligation 2019 $2,320,000 $2,204,000 2020 2,784,000 2,900,000 2021 3,422,000 3,016,000 2022 4,176,000 3,480,000 The average remaining service life per employee in 2019 and 2020 is 10 years and in 2021 and 2022 is 12 years. The net gain or loss that occurred during each year is as follows: 2019, $324,800 loss; 2020, $104,400 loss; 2021, $12,760 loss; and 2022, $29,000 gain. (In working the solution, the gains and losses must be ted to arrive at year-end balances.) Using the corridor approach, compute the amount of net gain or loss amortized and charged to pension expense in each of the four years, setting up an appropriate schedule. Year Minimum Amortization of Los 2019 24 2020 2$ 2021 2$ 2022 2$
The following information pertains to a defined benefit pension plan that Arora Inc. sponsors in 2020. PBO balance, January 1, 2020 $160,000 Service cost 19,000 Interest cost 11,200 Prior service cost adjustment based on past service, January 1, 2020 30,000 Amortization of prior service cost 3,000 Actuarial gain on PBO 6,000 Benefits paid to retirees 2,500 Contributions to plan 18,000 What is the PBO balance on December 31, 2020? Select one: a. $228,700 b. $216,700 c. $211,700 d. $193,700
On January 1, 2020, Blue Company has the following defined benefit pension plan balances. Projected benefit obligation $4,506,000 Fair value of plan assets 4,220,000 The interest (settlement) rate applicable to the plan is 10%. On January 1, 2021, the company amends its pension agreement so that prior service costs of $508,000 are created. Other data related to the pension plan are as follows. 2020 2021 Service cost $152,000 $179,000 Prior service cost amortization 0 91,000 Contributions (funding) to the plan 237,000 281,000 Benefits paid 202,000 284,000 Actual return on plan assets 253,200 262,000 Expected rate of return on assets 6 % 8 %
Sarasota Company provides the following information about its defined benefit pension plan for the year 2020. Service cost $ 88,500 Contribution to the plan 107,100 Prior service cost amortization 10,600 Actual and expected return on plan assets 63,100 Benefits paid 40,800 Plan assets at January 1, 2020 648,000 Projected benefit obligation at January 1, 2020 688,100 Accumulated OCI (PSC) at January 1, 2020 148,600 Interest/discount (settlement) rate 11 % Compute the pension expense for the year 2020. Pension expense for 2020 $enter the Pension expense for 2020 in dollars
Blossom Corp. sponsors a defined benefit pension plan for its employees. On January I, 2025, the following balances relate to this plan. Plan assets: $460,000 Projected benefit obligation: $606,500 Pension asset/liability: $146,500 Accumulated OCI (PSC): 104,200 Dr. As a result of the operation of the plan during 2025, the following additional data are provided by the actuary. Service cost: $93,500 Settlement rate, 10% Actual return on plan assets: $54,600 Amortization of prior service cost: $18,100 Expected return on plan assets: $51,600 Unexpected loss from change in projected benefit obligation, due to change in actuarial predictions: $76,600 Contributions: $100,500 Benefits paid retirees: $84,300 Using the data above, compute pension expense for Blossom for the year 2025 by preparing a pension worksheet. (Enter all amounts as positive.)
Wildhorse Company sponsors a defined benefit pension plan. The following information related to the pension plan is available for 2020 and 2021. 2020 2021 Plan assets (fair value), December 31 $817,830 $993,330 Projected benefit obligation, January 1 819,000 936,000 Pension asset/liability, January 1 163,800 Cr. ? Prior service cost, January 1 292,500 280,800 Service cost 70,200 105,300 Actual and expected return on plan assets 28,080 35,100 Amortization of prior service cost 11,700 14,040 Contributions (funding) 134,550 140,400 Accumulated benefit obligation, December 31 585,000 643,500 Interest/settlement rate 10 % 10 % Prepare the journal entries to record the pension expense and the company’s funding of the pension plan for both years.