What amount should Webb Company contribute in order to report an accrued liability for retirement benefit cost of P200,000 in its December 31, 2005 balance sheet? Webb Company implemented a defined benefit plan for its employees on January 1, 2002. During 2002 and 2003, Webb's contributions fully funded the plan. The following data are provided for 2004 and 2005: 2005 estimated 2004 actual Projected benefit obligation, 12/31 Accumulated benefit obligation, 12/31 Plan assets at fair value Projected benefit obligation in excess of plan assets Retirement benefit expense Employer's contribution P7,500,000 5,200,000 6,750,000 P7,000,000 5,000,000 6,000,000 750,000 900,000 ? 1,000,000 800,000 500,000 O (a) P1,000,000 O (b) P700,000 O (c) P600,000

What amount should Webb Company contribute in order to report an accrued liability for retirement benefit cost of P200,000 in its December 31, 2005 balance sheet? Webb Company implemented a defined benefit plan for its employees on January 1, 2002. During 2002 and 2003, Webb's contributions fully funded the plan. The following data are provided for 2004 and 2005: 2005 estimated 2004 actual Projected benefit obligation, 12/31 Accumulated benefit obligation, 12/31 Plan assets at fair value Projected benefit obligation in excess of plan assets Retirement benefit expense Employer's contribution P7,500,000 5,200,000 6,750,000 P7,000,000 5,000,000 6,000,000 750,000 900,000 ? 1,000,000 800,000 500,000 O (a) P1,000,000 O (b) P700,000 O (c) P600,000

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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Concept explainers

Employee Benefits

In an organization employees are the most important resource and most important asset. They can lead an organization to the sky or can be the reason for unsuccessful of business. Therefore, it is very much important that employees of an organization should be satisfied by the environment of the organization and most importantly with the salary, wages incentives, etc.

Question

What amount should Webb Company contribute in order to report an accrued
liability for retirement benefit cost of P200,000 in its December 31, 2005 balance
sheet?
Webb Company implemented a defined benefit plan for its employees on January 1, 2002.
During 2002 and 2003, Webb's contributions fully funded the plan. The following data are
provided for 2004 and 2005:
2005 estimated
2004 actual
Projected benefit obligation, 12/31
Accumulated benefit obligation, 12/31
Plan assets at fair value
Projected benefit obligation
in excess of plan assets
Retirement benefit expense
Employer's contribution
P7,500,000
5,200,000
6,750,000
P7,000,000
5,000,000
6,000,000
750,000
900,000
?
1,000,000
800,000
500,000
(a) P1,000,000
(b) P700,000
(c) P600,000
O (d) P500,000

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