On January 1, 2020, Indigo Company has the following defined benefit pension plan balances.Projected benefit obligation$4,571,000Fair value of plan assets4,210,000The interest (settlement) rate applicable to the plan is 10%. On January 1, 2021, the company amends its pension agreement so thatprior service costs of $492,000 are created. Other data related to the pension plan are as follows.20202021Service cost$152,000$179,000Prior service cost amortization89,000Contributions (funding) to the plan236,000285,000Benefits paid198,000275,000Actual return on plan assets252,600261,000Expected rate of return on assets6 %8 %Annual PensionItemsExpenseCashBalance, Jan. 1, 20202$$Service costInterest costActual returnContributionsBenefitsJournal entry for 2020$$Accumulated OCI, Dec. 31, 2019Balance, Dec. 31, 2020Additional PSC, 1/1/2021Balance, Jan. 1, 2021Service costInterest costActual returnUnexpected lossAmortization of PSCContributionsBenefitsJournal entry for 2021$$Accumulated OCI, Dec. 31, 2020Balance, Dec. 31, 2021>>>

Defined Benefit Pension Plan This was the foremost reputed pension plan which are provides to the…

On January 1, 2020, Indigo Company has the following defined benefit pension plan balances. Projected benefit obligation $4,571,000 Fair value of plan assets 4,210,000 The interest (settlement) rate applicable to the plan is 10%. On January 1, 2021, the company amends its pension agreement so that prior service costs of $492,000 are created. Other data related to the pension plan are as follows. 2020 2021 Service cost $152,000 $179,000 Prior service cost amortization 89,000 Contributions (funding) to the plan 236,000 285,000

On January 1, 2020, Indigo Company has the following defined benefit pension plan balances. Projected benefit obligation $4,571,000 Fair value of plan assets 4,210,000 The interest (settlement) rate applicable to the plan is 10%. On January 1, 2021, the company amends its pension agreement so that prior service costs of $492,000 are created. Other data related to the pension plan are as follows. 2020 2021 Service cost $152,000 $179,000 Prior service cost amortization 89,000 Contributions (funding) to the plan 236,000 285,000

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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Compute for the pension liability on December 31, 2021
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