Smith, Inc. has a pension plan with the following data available for 20X1 and 20X2: 20X120X2Service cost$30,000 $34,000 Interest cost$18,000 $20,000 Actual return on plan assets$15,000 $21,600 Beginning of year plan assets$200,000 $240,000 Discount rate 8% 8%Expected return on plan assets 8% 8% The adjustment to OCI for gain or loss from the return on plan assets for 20X1 is: Multiple Choice $0. $1,000 gain. $1,000 loss. unknown from information provided.

Correct option is (c) i.e The adjustment to OCI for loss from the return on plan assets for 20X1 is…

Answered: Smith, Inc. has a pension plan with the…

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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Smith, Inc. has a pension plan with the following data available for 20X1 and 20X2:

	20X1	20X2
Service cost	$	30,000		$	34,000
Interest cost	$	18,000		$	20,000
Actual return on plan assets	$	15,000		$	21,600
Beginning of year plan assets	$	200,000		$	240,000
Discount rate		8	%		8	%
Expected return on plan assets		8	%		8	%

The adjustment to OCI for gain or loss from the return on plan assets for 20X1 is:

Multiple Choice

$0.
$1,000 gain.
$1,000 loss.
unknown from information provided.

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