On January 1, 2020, Carla Vista Incorporated amended its pension plan which caused an increase of $5,460,150 in its projected benefit obligation. The company has 445 employees who are expected to receive benefits under the company's defined-benefit pension plan. The personnel department provided the following information regarding expected employee retirements: Number of Employees Expected Retirements On December 31 49 2020 129 2021 69 2022 169 2023 29 2024 445 The company plans to use the years-of-service method in calculating the amortization of prior service cost as a component of pension expense. Prepare a schedule which shows the amount of annual prior service cost amortization that the company will recognize as a component of pension expense fro
On January 1, 2020, Carla Vista Incorporated amended its pension plan which caused an increase of $5,460,150 in its projected benefit obligation. The company has 445 employees who are expected to receive benefits under the company's defined-benefit pension plan. The personnel department provided the following information regarding expected employee retirements: Number of Employees Expected Retirements On December 31 49 2020 129 2021 69 2022 169 2023 29 2024 445 The company plans to use the years-of-service method in calculating the amortization of prior service cost as a component of pension expense. Prepare a schedule which shows the amount of annual prior service cost amortization that the company will recognize as a component of pension expense fro
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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On January 1, 2020, Carla Vista Incorporated amended its pension plan which caused an increase of $5,460,150 in its projected benefit obligation. The company has 445 employees who are expected to receive benefits under the company's defined-benefit pension plan. The personnel department provided the following information regarding expected employee retirements:
|
Number of
Employees |
Expected Retirements
On December 31 |
|||
| 49 | 2020 | |||
| 129 | 2021 | |||
| 69 | 2022 | |||
| 169 | 2023 | |||
| 29 | 2024 | |||
| 445 |
The company plans to use the years-of-service method in calculating the amortization of prior service cost as a component of pension expense.
Prepare a schedule which shows the amount of annual prior service cost amortization that the company will recognize as a component of pension expense from 2020 through 2024.
Transcribed Image Text:Carla Vista Incorporated
Computation of Annual Prior Service Cost Amortization
Total
Cost Per
Annual
Year
Service-Years
Service-Year
Amortization
2020
$
$
2021
2022
2023
2024
$
%24
%24
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