Sandhill Company sponsors a defined benefit pension plan for its employees. The following data relate to the operation of the plan for the years 2025 and 2026. Projected benefit obligation, January 1 Plan assets (fair value and market-related value), January 1 Pension asset/liability, January 1 Prior service cost, January 1 Service cost Settlement rate Expected rate of return Actual return on plan assets Amortization of prior service cost Annual contributions Benefits paid retirees Increase in projected benefit obligation due to changes in actuarial assumptions Accumulated benefit obligation at December 31 Average service life of all employees Vested benefit obligation at December 31 (a1) 2025 Amortization of the loss S $596,000 411,600 184,400 Cr. 161,400 40,300 10% 10% 35,800 69,500 97,300 31,200 87,100 720,200 Calculate the amortization of the loss (2026) using the corridor approach. 2026 $58,800 10% 10% 61,100 50,500 80,500 53,900 0 792,000 20 years 463,600

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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Sandhill Company sponsors a defined benefit pension plan for its employees. The following data relate to the operation of the plan for
the years 2025 and 2026.
Projected benefit obligation, January 1
Plan assets (fair value and market-related value), January 1
Pension asset/liability, January 1
Prior service cost, January 1
Service cost
Settlement rate
Expected rate of return
Actual return on plan assets
Amortization of prior service cost
Annual contributions
Benefits paid retirees
Increase in projected benefit obligation
due to changes in actuarial assumptions
Accumulated benefit obligation at December 31
Average service life of all employees
Vested benefit obligation at Decem -31
(a1)
2025
Amortization of the loss $
$596,000
411,600
184,400 Cr.
161,400
40,300
10%
10%
35,800
69,500
97,300
31,200
87,100
720,200
Calculate the amortization of the loss (2026) using the corridor approach.
2026
$58,800
10%
10%
61,100
50,500
80,500
53,900
0
792,000
20 years
463,600
Transcribed Image Text:Sandhill Company sponsors a defined benefit pension plan for its employees. The following data relate to the operation of the plan for the years 2025 and 2026. Projected benefit obligation, January 1 Plan assets (fair value and market-related value), January 1 Pension asset/liability, January 1 Prior service cost, January 1 Service cost Settlement rate Expected rate of return Actual return on plan assets Amortization of prior service cost Annual contributions Benefits paid retirees Increase in projected benefit obligation due to changes in actuarial assumptions Accumulated benefit obligation at December 31 Average service life of all employees Vested benefit obligation at Decem -31 (a1) 2025 Amortization of the loss $ $596,000 411,600 184,400 Cr. 161,400 40,300 10% 10% 35,800 69,500 97,300 31,200 87,100 720,200 Calculate the amortization of the loss (2026) using the corridor approach. 2026 $58,800 10% 10% 61,100 50,500 80,500 53,900 0 792,000 20 years 463,600
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