Blossom, Inc. has a defined-benefit pension plan covering its 50 employees. Blossom agrees to amend its pension benefits. As a result, the projected benefit obligation increased by $2115000. Blossom determined that all its employees are expected to receive benefits under the plan over the next 5 years. In addition, 10 employees are expected to retire or quit each year. Assuming that Blossom uses the years-of-service method of amortization for prior service cost, the amount reported as amortization of prior service cost in year one after the amendment is $423000. $493500. $705000.
Blossom, Inc. has a defined-benefit pension plan covering its 50 employees. Blossom agrees to amend its pension benefits. As a result, the projected benefit obligation increased by $2115000. Blossom determined that all its employees are expected to receive benefits under the plan over the next 5 years. In addition, 10 employees are expected to retire or quit each year. Assuming that Blossom uses the years-of-service method of amortization for prior service cost, the amount reported as amortization of prior service cost in year one after the amendment is $423000. $493500. $705000.
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter19: Accounting For Post Retirement Benefits
Section: Chapter Questions
Problem 15E
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Blossom, Inc. has a defined-benefit pension plan covering its 50 employees. Blossom agrees to amend its pension benefits. As a result, the projected benefit obligation increased by $2115000. Blossom determined that all its employees are expected to receive benefits under the plan over the next 5 years. In addition, 10 employees are expected to retire or quit each year. Assuming that Blossom uses the years-of-service method of amortization for prior service cost, the amount reported as amortization of prior service cost in year one after the amendment is
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$423000. |
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$493500. |
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$705000. |
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$141000. |
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