For compensation plans adopted by a publicly traded company in the current year, when a CEO's salary exceeds $1,000,000, the employeetaxed on the entire amount, and the employerallowed a deduction on the entire amount.Multiple ChoiceОis; isis not; isis not; is notis; is not

The employee is taxed on the entire amount.The employer is not allowed a deduction on the entire…

Answered: For compensation plans adopted by a…

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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CHOOSE THE LETTER OF THE CORRECT ANSWER What is the employee benefit expense for the current year? a. 1,180,000b. 2,100,000c. 1,850,000d. 1,050,000 What is the remeasurement gain or loss on plan assets on Dec. 31? a. 670,000 gainb. 670,000 lossc. 650,000 gaind. 650,000 loss
Question 32: What statement about Form l-9 is accurate? Answer: A. O The employee submits one or two documents to verify employment eligibility. В. O It was significantly revised and expanded in 2020. C. O A company submits this to request an EIN. D. O It is also referred to as Publication 15. Question 33: Match each incentive plan to its definition. Profit-sharing Employee receives a portion of the company's profits after exceeding a predetermined level DROP HERE Employee may purchase shares of the business after meeting predetermined goals Stock options DROP HERE Sabbaticals Paid leave after working a predetermined number of years DROP HERE Monies received for reaching a specific sales/production goal Cash incentives DROP HERE Question 34: Rachel is a server at a family restaurant in Omaha, NE. As a tipped employee, she receives an hourly wage that is less than the federal minimum wage. This week, her combined hourly wages and tips was less than the federal minimum wage. What happens…
Statement 1: For a rank and file employee, excess de minimis benefits shall form part of his taxable regular compensation. Statement 2: For a managerial employee, excess de minimis benefits shall form part of his 13th month pay and other benefits. A. Both statements are true B. Both statements are false C. Only statement 1 is true D. Only statement 2 is true
Not a graded assignment
FASB ASC 715–60: Compensation–Retirement Benefits–Defined Benefit Plans–Other Postretirement (previously Statement of Financial Accounting Standards No. 106) establishes accounting standards for postretirement benefits other than pensions, most notably postretirement health care benefits. Essentially, the standard requires companies to accrue compensation expense each year employees perform services, for the expected cost of providing future postretirement benefits that can be attributed to that service. Typically, companies do not prefund these costs for two reasons: (a) unlike pension liabilities, no federal law requires companies to fund nonpension postretirement benefits and (b) funding contributions, again unlike for pension liabilities, are not tax deductible. (The costs aren’t tax deductible until paid to, or on behalf of, employees.) Required: 1. As a result of being required to record the periodic postretirement expense and related liability, most companies now report lower…
ACCOUNTING 4 EMPLOYEE BENEFITS A. At the beginning of current year, an entity provided the following information in connection with a defined benefit plan: Fair value of plan assets Projected benefit obligation Prepaid /accrued benefit cost 10,000,000 (13,000,000) (3,000,000) The entity revealed the following transactions affecting the plan for the current year: 2,500,000 1,200,000 Current service cost Past service cost - remaining vesting period of covered employees is 5 years Contribution to the plan Benefits paid to retirees Actual return on plan assets Decrease in projected benefit obligation due to change in actuarial assumptions 3,500,000 3,000,000 1,500,000 400,000 10% 12% Discount rate Expected return on plan assets REQUIRED: 1. Compute the employee benefit expense for the current year 2. Compute the net remeasurement gain for the current year 3. Compute the fair value of plan assets at year-end 4. Compute the projected benefit obligation at year-end 5. What amount should be…
What is the employee benefit expense for the current year? 1 300 000 1 050 000 1 500 000 1 100 000 What is the projected benefit obligation at year-end? 5 650 000 6 650 000 6 400 000 6 450 000
Indicate by letter whether each of the events listed below increases (I), decreases (D), or has no effect (N) on an employer's projected benefit obligation. Events 1. Interest cost. 2. Amortization of prior service cost. 3. A decrease in the average life expectancy of employees. 4. An increase in the average life expectancy of employees. 5. A plan amendment that increases benefits is made retroactive to prior years. 6. An increase in the actuary's assumed discount rate. 7. Cash contributions to the pension fund by the employer. 8. Benefits are paid to retired employees. 9. Service cost. 10. Return on plan assets during the year are lower than expected. 11. Return on plan assets during the year are higher than expected.
Puhlman Inc. provides a defined benefit pension plan to its employees. It smooths recognition of its gains and losses when computing its market-related value to compute expected return. Additional information follows: December 31, Description 20X1 20X0 ? $2,500,000 2,150,000 2,100,000 PBO АВО $2,335,000 Fair value of plan assets Market-related value of plan assets (smoothed recognition) Benefit payments made AOCI-net actuarial (gain) loss AOCI-prior service cost Balance sheet pension asset (liability) 2,342,800 272,000 114,000 2,100,000 231,000 -0- 400,000 (400,000) 214,000 321,000 129,000 Service cost Contribution Actual return Discount rate for PBO 9% 10% Expected rate of return Average remaining service life of employees 10% 10% 15 years 15 years During 20X1, the PBO increased by $33,000 due to a decrease in the discount rate from the previous year. The 20X0 discount rate assumption was used to compute 20X1 service cost and interest cost. Required: 1. Compute the fair value of plan…
Under PAS on employee benefits, past service cost if not yet vested a. Is recognized as a prior period adjustment b. Is recognised immediately in profit or lossc. Is amortized over the vesting period which is at least 10 million years d. Is recognized as expense in the current and future periods until the end of the world or until the moon turns blue, whichever comes earlier
result of the termination benefits in 2020? retirement age specified in the entity's pension plan. offer expired on November 30, 2020. 2. What amount should be recognized in profit or loss as a On September 1, 2020, Howe Company offered special termination benefits to employees who had reached the early The termination benefits consisted of lump sum and periodic receive the usual early retirement pension benefits. The Additionally, the employees accepting the entity offer Problem 19-15 (AICPA Adapted) ay ng future payments. ry Additionally, the employees accepting the entity offer neive the usual early retirement pension benefits. The d. Actual or reasonably estimated amounts on December 31, 2020 relating to the employees accepting the offer are as follows: 475,000 Lump sum payments made on January 1, 2021 Present value of periodic payments of P60,000 annually for 3 years which will begin January 1, 2022 ge 155,000 Reduction of accrued pension cost on December 31, 2020 for terminating…
Indicate by letter whether each of the events listed below increases (I), decreases (D), or has no effect (N) on an employer's periodic pension expense in the year the event occurs. Events 1. Interest cost. _____ 2. Amortization of prior service cost---AOCI. ______ 3.Excess of the expected return on plan assets over the actual return _____ 4. Expected return on plan assets. _____ 5. A plan amendment that increases benefits is made retroactive to prior years. ____ 6. Actuary's estimate of the PBO is increased.…

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For compensation plans adopted by a publicly traded company in the current year, when a CEO's salary exceeds $1,000,000, the employee taxed on the entire amount, and the employer allowed a deduction on the entire amount. Multiple Choice О is; is is not; is is not; is not is; is not