Cullumber Company sponsors a defined benefit pension plan for its 600 employees. The company's actuary provided the following information about the plan. January 1, December 31, 2025 2025 2026 Projected benefit obligation $2,780,000 $3,626,200 $4,166,296 Accumulated benefit obligation 1,900,000 2,426,000 2,925,000 Plan assets (fair value and market-related asset value) 1,690,000 2,892,000 3,790,000 Accumulated net (gain) or loss (for purposes of the corridor calculation) 0 198,000 (24,000) Discount rate (current settlement rate) 9% 8% Actual and expected asset return rate 10% 10% Contributions 1,033,000 608,800 The average remaining service life per employee is 10.5 years. The service cost component of net periodic pension expense for employee services rendered amounted to $398,000 in 2025 and $472,000 in 2026. The accumulated OCI (PSC) on January 1, 2025, was $1,522,500. No benefits have been paid. (a) Compute the amount of accumulated OCI (PSC) to be amortized as a component of net periodic pension expense for each of the years 2025 and 2026. Amount of accumulated OCI (PSC) to be amortized for the year 2025 $ Amount of accumulated OCI (PSC) to be amortized for the year 2026 $
Cullumber Company sponsors a defined benefit pension plan for its 600 employees. The company's actuary provided the following information about the plan. January 1, December 31, 2025 2025 2026 Projected benefit obligation $2,780,000 $3,626,200 $4,166,296 Accumulated benefit obligation 1,900,000 2,426,000 2,925,000 Plan assets (fair value and market-related asset value) 1,690,000 2,892,000 3,790,000 Accumulated net (gain) or loss (for purposes of the corridor calculation) 0 198,000 (24,000) Discount rate (current settlement rate) 9% 8% Actual and expected asset return rate 10% 10% Contributions 1,033,000 608,800 The average remaining service life per employee is 10.5 years. The service cost component of net periodic pension expense for employee services rendered amounted to $398,000 in 2025 and $472,000 in 2026. The accumulated OCI (PSC) on January 1, 2025, was $1,522,500. No benefits have been paid. (a) Compute the amount of accumulated OCI (PSC) to be amortized as a component of net periodic pension expense for each of the years 2025 and 2026. Amount of accumulated OCI (PSC) to be amortized for the year 2025 $ Amount of accumulated OCI (PSC) to be amortized for the year 2026 $
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Cullumber Company sponsors a defined benefit pension plan for its 600 employees. The company's actuary provided the following
information about the plan.
January 1,
December 31,
2025
2025
2026
Projected benefit obligation
$2,780,000 $3,626,200 $4,166,296
Accumulated benefit obligation
1,900,000
2,426,000
2,925,000
Plan assets (fair value and market-related asset value)
1,690,000
2,892,000
3,790,000
Accumulated net (gain) or loss (for purposes
of the corridor calculation)
0
198,000
(24,000)
Discount rate (current settlement rate)
9%
8%
Actual and expected asset return rate
10%
10%
Contributions
1,033,000
608,800
The average remaining service life per employee is 10.5 years. The service cost component of net periodic pension expense for
employee services rendered amounted to $398,000 in 2025 and $472,000 in 2026. The accumulated OCI (PSC) on January 1, 2025,
was $1,522,500. No benefits have been paid.
(a)
Compute the amount of accumulated OCI (PSC) to be amortized as a component of net periodic pension expense for each of the
years 2025 and 2026.
Amount of accumulated OCI (PSC) to be amortized for the year 2025
$
Amount of accumulated OCI (PSC) to be amortized for the year 2026
$
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