contribution of P2,000,000 to a fund held and managed by a5. An entity's retirement benefit plan provides for an annualontribution of P2,000,000 to a fund held and managed by athird party. The fund is legally separate from the entity and isto be used solely for the retirement pay of employees. Theamount to be received by a retiring employee is dependent onthe amount of contributions and the investment incomeearned on those contributions. The third party trustee assumesthe obligation of disbursing the funds to retiring employees.The entity made the following contributions to the fund: 20x1,PO; 20x2, P4,700,000; and 20x3, P1,200,000Requirements: Provide the entries to record the contributions.

In the given case, the fund is legally separate from the entity and the third party trustee assumes…

contribution of P2,000,000 to a fund held and managed by a An entity's retirement benefit plan provides for an annual third party. The fund is legally separate from the entity and is to be used solely for the retirement pay of employees. The amount to be received by a retiring employee is dependent on

contribution of P2,000,000 to a fund held and managed by a An entity's retirement benefit plan provides for an annual third party. The fund is legally separate from the entity and is to be used solely for the retirement pay of employees. The amount to be received by a retiring employee is dependent on

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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In a defined-benefit plan, a formula is used that Select one: a. requires that the benefit of gain or the risk of loss from the assets contributed to the pension plan be borne by the employee. b. requires that pension expense and the cash funding amount be the same. c. defines the contribution the employer is to make; no promise is made concerning the ultimate benefits to be paid out to the employees. d. defines the benefits that the employee will receive at the time of retirement.
Which one of the following is a correct statement about the nontax characteristics of a pooled income fund? A)It must pay a fixed dollar amount to the charitable beneficiary annually. B)The principal is distributed to the charitable beneficiary at the end of the noncharitable beneficiary's (or beneficiaries') life (or lives). C)Only the grantor and the charity can be beneficiaries. D)The income beneficiary cannot receive more than 10% of the original principal value per year.
Oriole Company received the following selected information from its pension plan trustee concerning the operation of the company's defined benefit pension plan for the year ended December 31, 2025. SEE ATTACHED IMAGE The service cost component of pension expense for employee services rendered in the current year amounted to $77,000 and the amortization of prior service cost was $122,100. The company's actual funding (contributions) of the plan in 2025 amounted to $252,000. The expected return on plan assets and the actual rate were both 10%; the interest/discount (settlement) rate was 10%. Accumulated other comprehensive income (PSC) had a balance of $1,221,000 on January 1, 2025. Assume no benefits paid in 2025. Prepare the journal entry to record pension expense and the employer's contribution to the pension plan in 2025. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles…
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