Headland Company adopts acceptable accounting for its defined benefit pension plan on January 1, 2019, with the following beginning balances: plan assets $201,400; projected benefit obligation $245,000. Other data relating to 3 years’ operation of the plan are as follows. 2019 2020 2021 Annual service cost $15,800 $19,400 $26,100 Settlement rate and expected rate of return 10 % 10 % 10 % Actual return on plan assets 18,000 22,150 24,000 Annual funding (contributions) 15,800 40,000 47,500 Benefits paid 13,700 16,500 20,800 Prior service cost (plan amended, 1/1/20) 160,000 Amortization of prior service cost 53,800 41,700 Change in actuarial assumptions establishes a December 31, 2021, projected benefit obligation of: 522,200 (a) Prepare a pension worksheet presenting all 3 years’ pension balances and activities. (Enter all amounts as positive.) HEADLAND COMPANY Pension Worksheet—2019, 2020, 2021 General Journal Entries Memo Record Annual Pension Expense Cash OCI—Prior
Headland Company adopts acceptable accounting for its defined benefit pension plan on January 1, 2019, with the following beginning balances: plan assets $201,400; projected benefit obligation $245,000. Other data relating to 3 years’ operation of the plan are as follows. 2019 2020 2021 Annual service cost $15,800 $19,400 $26,100 Settlement rate and expected rate of return 10 % 10 % 10 % Actual return on plan assets 18,000 22,150 24,000 Annual funding (contributions) 15,800 40,000 47,500 Benefits paid 13,700 16,500 20,800 Prior service cost (plan amended, 1/1/20) 160,000 Amortization of prior service cost 53,800 41,700 Change in actuarial assumptions establishes a December 31, 2021, projected benefit obligation of: 522,200 (a) Prepare a pension worksheet presenting all 3 years’ pension balances and activities. (Enter all amounts as positive.) HEADLAND COMPANY Pension Worksheet—2019, 2020, 2021 General Journal Entries Memo Record Annual Pension Expense Cash OCI—Prior
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
10.
Headland Company adopts acceptable accounting for its defined benefit pension plan on January 1, 2019, with the following beginning balances: plan assets $201,400; projected benefit obligation $245,000. Other data relating to 3 years’ operation of the plan are as follows.
|
2019
|
2020
|
2021
|
|||||||
| Annual service cost | $15,800 | $19,400 | $26,100 | ||||||
| Settlement rate and expected |
10 | % | 10 | % | 10 | % | |||
| Actual return on plan assets | 18,000 | 22,150 | 24,000 | ||||||
| Annual funding (contributions) | 15,800 | 40,000 | 47,500 | ||||||
| Benefits paid | 13,700 | 16,500 | 20,800 | ||||||
| Prior service cost (plan amended, 1/1/20) | 160,000 | ||||||||
| Amortization of prior service cost | 53,800 | 41,700 | |||||||
| Change in actuarial assumptions establishes a December 31, 2021, projected benefit obligation of: |
522,200 |
(a)
Prepare a pension worksheet presenting all 3 years’ pension balances and activities. (Enter all amounts as positive.)
|
HEADLAND COMPANY
Pension Worksheet—2019, 2020, 2021 |
||||||
|
General
|
Memo Record
|
|||||
|
Annual Pension
Expense |
Cash
|
OCI—Prior
|
Expert Solution
Step 1 Introduction
Pension Obligation: There are three alternative methods to estimate the future spending or obligations connected with a pension plan, and the word "pension obligation" may apply to any of them. In general, pension liabilities may be expressed in terms of accrued, vested, and anticipated benefits, with cumulative benefits being the most common.
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education