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Sheffield Company sponsors a defined benefit plan for its 100 employees. On January 1, 2020, the company's actuary provided the following information (a) Accumulated other comprehensive loss (PSC) Pension plan assets (fair value and market-related asset value) Accumulated benefit obligation Projected benefit obligation $151,200 201,300 264,200 379,100 The average remaining service period for the participating employees is 10 years. All employees are expected to receive benefits under the plan. On December 31, 2020, the actuary calculated that the present value of future benefits earned for employee services rendered in the current year amounted to $52,600, the projected benefit obligation was $483,300; fair value of pension assets was $277,300, the accumulated benefit obligation amounted to $368,800. The expected return on plan assets and the discount rate on the projected benefit obligation were both 10%. The actual return on plan assets is $10,400. The company's current year's contribution to the pension plan amounted to $65,600. No benefits were paid during the year. Show Transcribed Text

Sheffield Company sponsors a defined benefit plan for its 100 employees. On January 1, 2020, the company's actuary provided the following information (a) Accumulated other comprehensive loss (PSC) Pension plan assets (fair value and market-related asset value) Accumulated benefit obligation Projected benefit obligation $151,200 201,300 264,200 379,100 The average remaining service period for the participating employees is 10 years. All employees are expected to receive benefits under the plan. On December 31, 2020, the actuary calculated that the present value of future benefits earned for employee services rendered in the current year amounted to $52,600, the projected benefit obligation was $483,300; fair value of pension assets was $277,300, the accumulated benefit obligation amounted to $368,800. The expected return on plan assets and the discount rate on the projected benefit obligation were both 10%. The actual return on plan assets is $10,400. The company's current year's contribution to the pension plan amounted to $65,600. No benefits were paid during the year. Show Transcribed Text

FINANCIAL ACCOUNTING
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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Sheffield Company sponsors a defined benefit plan for its 100 employees. On January 1, 2020, the company's actuary provided the following information. (a) Accumulated other comprehensive loss (PSC) Pension plan assets (fair value and market-related asset value) Accumulated benefit obligation Projected benefit obligation The average remaining service period for the participating employees is 10 years. All employees are expected to receive benefits under the plan. On December 31, 2020, the actuary calculated that the present value of future benefits earned for employee services rendered in the current year amounted to $52,600, the projected benefit obligation was $483,300; fair value of pension assets was $277,300; the accumulated benefit obligation amounted to $368,800. The expected return on plan assets and the discount rate on the projected benefit obligation were both 10%. The actual return on plan assets is $10,400. The company's current year's contribution to the pension plan amounted to $65,600. No benefits were paid during the year. Show Transcribed Text Your answer is correct. Determine the components of pension expense that the company would recognize in 2020. (With only one year involved, you need not prepare a worksheet) (Enter amounts that reduce pension expense with either a negative sign preceding the number eg -45 or parenthesis eg. (45)) Service Cost Interest on Projected Benefit Obligation Components of Pension Expense Actual Return on Plan Assets Unexpected Loss Amortization of Gain or Loss Amortization of Prior Service Cost Pension Expense V ♥ v $151,200 201,300 264,200 379,100 v V $ . 52600 37910 (10400) (9730) 0 15120 85500
Transcribed Image Text:Sheffield Company sponsors a defined benefit plan for its 100 employees. On January 1, 2020, the company's actuary provided the following information. (a) Accumulated other comprehensive loss (PSC) Pension plan assets (fair value and market-related asset value) Accumulated benefit obligation Projected benefit obligation The average remaining service period for the participating employees is 10 years. All employees are expected to receive benefits under the plan. On December 31, 2020, the actuary calculated that the present value of future benefits earned for employee services rendered in the current year amounted to $52,600, the projected benefit obligation was $483,300; fair value of pension assets was $277,300; the accumulated benefit obligation amounted to $368,800. The expected return on plan assets and the discount rate on the projected benefit obligation were both 10%. The actual return on plan assets is $10,400. The company's current year's contribution to the pension plan amounted to $65,600. No benefits were paid during the year. Show Transcribed Text Your answer is correct. Determine the components of pension expense that the company would recognize in 2020. (With only one year involved, you need not prepare a worksheet) (Enter amounts that reduce pension expense with either a negative sign preceding the number eg -45 or parenthesis eg. (45)) Service Cost Interest on Projected Benefit Obligation Components of Pension Expense Actual Return on Plan Assets Unexpected Loss Amortization of Gain or Loss Amortization of Prior Service Cost Pension Expense V ♥ v $151,200 201,300 264,200 379,100 v V $ . 52600 37910 (10400) (9730) 0 15120 85500
(b) (c) ✓ Your answer is correct. Prepare the journal entry to record the pension expense and the company's funding of the pension plan in 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter O for the amounts) Account Titles and Explanation Other Comprehensive Income (G/L) Pension Expense Cash Pension Asset/Liability Other Comprehensive Income (PSC) -Your answer is partially correct. 2020 Increase/Decrease in Losses Show Transcribed Text Amortization in 2020 G Amortization in 2021 $ $ $ 23420 Compute the amount of the 2020 increase/decrease in gains or losses and the amount to be amortized in 2020 and 2021. . Debit 0 23420 506720 85500 Credit Ċ 65600 28200 15120
Transcribed Image Text:(b) (c) ✓ Your answer is correct. Prepare the journal entry to record the pension expense and the company's funding of the pension plan in 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter O for the amounts) Account Titles and Explanation Other Comprehensive Income (G/L) Pension Expense Cash Pension Asset/Liability Other Comprehensive Income (PSC) -Your answer is partially correct. 2020 Increase/Decrease in Losses Show Transcribed Text Amortization in 2020 G Amortization in 2021 $ $ $ 23420 Compute the amount of the 2020 increase/decrease in gains or losses and the amount to be amortized in 2020 and 2021. . Debit 0 23420 506720 85500 Credit Ċ 65600 28200 15120
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