Sandhill, Inc. received the following information from its pension plan trustee concerning the operation of the company's defined- benefit pension plan for the year ended December 31, 2026: Fair value of pension plan assets Projected benefit obligation Accumulated benefit obligation Accumulated OCI - (Gains/Losses) Actual return on plan assets January 1, 2026 $6000000 6800000 1160000 December 31, 2026 $6400000 7280000 1400000 (80000) 160000 The service cost component of pension expense for 2026 is $800000 and the amortization of prior service cost due to an increase in benefits is $88000. The settlement rate is 10%. Assuming that the actual return equals the expected return on plan assets, what is the amount of pension expense for 2026?
Sandhill, Inc. received the following information from its pension plan trustee concerning the operation of the company's defined- benefit pension plan for the year ended December 31, 2026: Fair value of pension plan assets Projected benefit obligation Accumulated benefit obligation Accumulated OCI - (Gains/Losses) Actual return on plan assets January 1, 2026 $6000000 6800000 1160000 December 31, 2026 $6400000 7280000 1400000 (80000) 160000 The service cost component of pension expense for 2026 is $800000 and the amortization of prior service cost due to an increase in benefits is $88000. The settlement rate is 10%. Assuming that the actual return equals the expected return on plan assets, what is the amount of pension expense for 2026?
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter19: Accounting For Post Retirement Benefits
Section: Chapter Questions
Problem 7E
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![Sandhill, Inc. received the following information from its pension plan trustee concerning the operation of the company's defined-
benefit pension plan for the year ended December 31, 2026:
Fair value of pension plan assets
Projected benefit obligation
Accumulated benefit obligation
Accumulated OCI - (Gains/Losses)
Actual return on plan assets
January 1, 2026
$6000000
$888000
$1080000
$1568000
O $1408000
6800000
1160000
December 31, 2026
$6400000
7280000
1400000
(80000)
160000
The service cost component of pension expense for 2026 is $800000 and the amortization of prior service cost due to an increase in
benefits is $88000. The settlement rate is 10%. Assuming that the actual return equals the expected return on plan assets, what is the
amount of pension expense for 2026?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F11bd0a08-538c-4af5-9e0d-dc6d6997c505%2F87c751e9-6e1c-415f-8fac-033df3d25155%2F2ydvgon_processed.png&w=3840&q=75)
Transcribed Image Text:Sandhill, Inc. received the following information from its pension plan trustee concerning the operation of the company's defined-
benefit pension plan for the year ended December 31, 2026:
Fair value of pension plan assets
Projected benefit obligation
Accumulated benefit obligation
Accumulated OCI - (Gains/Losses)
Actual return on plan assets
January 1, 2026
$6000000
$888000
$1080000
$1568000
O $1408000
6800000
1160000
December 31, 2026
$6400000
7280000
1400000
(80000)
160000
The service cost component of pension expense for 2026 is $800000 and the amortization of prior service cost due to an increase in
benefits is $88000. The settlement rate is 10%. Assuming that the actual return equals the expected return on plan assets, what is the
amount of pension expense for 2026?
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