Wella Company reported a prepaid benefit cost of P 1,500,000 on January 1, 2016. The entity provided the following information related to defined benefit plan during the current year: Current service cost 3,000,000 Actual return on plan assets Interest cost 1,200,000 800,000 500,000 Settlement price of benefit obligation paid in advance Present value of benefit obligation paid in advance 600,000 Interest income 1,000,000 Actual gain in PBO Past service cost 400,000 500,000 Benefits paid to retirees Contribution to the plan Projected benefit obligation January 1 Fair value of plan assets- January 1 Asset ceiling - January 1 Asset ceiling- December 31 2,500,000 4,000,000 8,000,000 10,000,000 1,500,000 2,000,000 Discount rate 10%

Wella Company reported a prepaid benefit cost of P 1,500,000 on January 1, 2016. The entity provided the following information related to defined benefit plan during the current year: Current service cost 3,000,000 Actual return on plan assets Interest cost 1,200,000 800,000 500,000 Settlement price of benefit obligation paid in advance Present value of benefit obligation paid in advance 600,000 Interest income 1,000,000 Actual gain in PBO Past service cost 400,000 500,000 Benefits paid to retirees Contribution to the plan Projected benefit obligation January 1 Fair value of plan assets- January 1 Asset ceiling - January 1 Asset ceiling- December 31 2,500,000 4,000,000 8,000,000 10,000,000 1,500,000 2,000,000 Discount rate 10%

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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