On January 1, 2016, Ju Co. has the following balances: Defined benefit obligation P2,100,000 Fair value of plan assets 1,800,000 The discount rate is 10%. Other data related to the pension plan for 2016 are: Service cost P180,000 Past service costs due to increase in benefits 60,000

On January 1, 2016, Ju Co. has the following balances: Defined benefit obligation P2,100,000 Fair value of plan assets 1,800,000 The discount rate is 10%. Other data related to the pension plan for 2016 are: Service cost P180,000 Past service costs due to increase in benefits 60,000

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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Concept explainers

Employee Benefits

In an organization employees are the most important resource and most important asset. They can lead an organization to the sky or can be the reason for unsuccessful of business. Therefore, it is very much important that employees of an organization should be satisfied by the environment of the organization and most importantly with the salary, wages incentives, etc.

Question

On January 1, 2016, Ju Co. has the following balances:
Defined benefit obligation
P2,100,000
Fair value of plan assets
1,800,000
The discount rate is 10%. Other data related to the pension plan for 2016 are:
Service cost
P180,000
Past service costs due to increase in benefits
60,000
Contributions
300,000
Benefits paid
105,000
Actual return on plan assets
237,000
Net gain on liability
18,000
The fair value of plan assets at December 31, 2016 is

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