INTERM.ACCT.:REPORTING...-CENGAGENOWV2
3rd Edition
ISBN: 9781337909358
Author: WAHLEN
Publisher: CENGAGE L
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Chapter 19, Problem 8E
To determine
Prepare necessary journal entries of Company F for 2019.
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Farber Company adopted a defined benefit pension plan on January 1, 2019, at which time it awarded retroactive benefits to its employees. This prior service cost amounted to $200,000, which the company did not fund. Farber planned to amortize this prior service cost in the amount of $10,000 per year. Farber determined its pension expense (which included the prior service cost amortization) to be $75,000 for 2019, of which the company funded $74,000. At the end of 2019, the fair value of the pension plan assets was $74,000 and Farber’s projected benefit obligation was $265,000.
Prepare all the journal entries related to Farber’s pension plan for 2019.
Prepare all the journal entries related to Farber’s pension plan for 2019.
Jay Company has had a defined benefit pension plan for several years. At the beginning of 2019, Jay amended the plan; this amendment provided for increased benefits to employees based on services rendered in prior periods. The prior service cost related to this amendment totaled $88,000. As a result, the projected benefit obligation increased. Jay decided not to fund the increased obligation at the time of the amendment, but rather to increase its periodic year-end contributions to the pension plan.
The following information for 2019 has been provided by Jay’s actuary and funding agency and obtained from a review of its accounting records:
Projected benefit obligation (12/31)
$808,090
Service cost
183,000
Discount rate
9%
Cumulative net loss (1/1)
64,500
Company contribution to pension plan (12/31)
200,000
Projected benefit obligation (1/1)*
513,000
Plan assets, fair value (12/31)
698,000
Accrued pension cost (liability) (1/1)
33,000*
Expected (and actual) return…
When Turner Company adopted its defined benefit pension plan on January 1, 2019, it awarded retroactive benefits to its employees. These retroactive benefits resulted in a prior service cost of $980,000 that created a projected benefit obligation of the same amount on that date (which it did not fund). Turner decided to amortize the prior service cost using the years-of-future-service method. Turner’s actuary and funding agency have provided the following additional information for 2019 and 2020: (1) service cost: 2019, $187,000; 2020, $189,000; (2) plan assets: 1/1/2019, $0; 1/1/2020, $342,000; (3) expected long-term (and actual) rate of return on plan assets: 2020, 9%; (4) discount rate for both 2019 and 2020: 8%; and (5) amortization fraction for prior service cost: 2019, 80/980; 2020, 79/980. Turner contributed $342,000 and $336,000 to the pension fund at the end of 2019 and 2020, respectively. No retirement benefits were paid in either year. There are no other components of…
Chapter 19 Solutions
INTERM.ACCT.:REPORTING...-CENGAGENOWV2
Ch. 19 - Prob. 1GICh. 19 - Prob. 2GICh. 19 - Prob. 3GICh. 19 - Prob. 4GICh. 19 - Prob. 5GICh. 19 - Prob. 6GICh. 19 - Prob. 7GICh. 19 - Prob. 8GICh. 19 - Prob. 9GICh. 19 - Prob. 10GI
Ch. 19 - Prob. 11GICh. 19 - Prob. 12GICh. 19 - Prob. 13GICh. 19 - Prob. 14GICh. 19 - Prob. 15GICh. 19 - Prob. 16GICh. 19 - Prob. 17GICh. 19 - Prob. 18GICh. 19 - Prob. 19GICh. 19 - Prob. 20GICh. 19 - Prob. 21GICh. 19 - Prob. 22GICh. 19 - Prob. 23GICh. 19 - The actuarial present value of all the benefits...Ch. 19 - Prob. 2MCCh. 19 - Prob. 3MCCh. 19 - Prob. 4MCCh. 19 - Prob. 5MCCh. 19 - Prob. 6MCCh. 19 - Which of the following is not a component of...Ch. 19 - Prob. 8MCCh. 19 - Prob. 9MCCh. 19 - Prob. 10MCCh. 19 - Prob. 1RECh. 19 - Prob. 2RECh. 19 - Pinecone Company has plan assets of 500,000 at the...Ch. 19 - Prob. 4RECh. 19 - Prob. 5RECh. 19 - Prob. 6RECh. 19 - Prob. 7RECh. 19 - Prob. 8RECh. 19 - Given the following information for Tyler Companys...Ch. 19 - At the beginning of Year 1, Cactus Company has...Ch. 19 - Prob. 11RECh. 19 - Prob. 1ECh. 19 - Prob. 2ECh. 19 - Prob. 3ECh. 19 - Prob. 4ECh. 19 - Prob. 5ECh. 19 - Prob. 6ECh. 19 - Prob. 7ECh. 19 - Prob. 8ECh. 19 - Prob. 9ECh. 19 - Prob. 10ECh. 19 - Prob. 11ECh. 19 - Prob. 12ECh. 19 - Prob. 13ECh. 19 - Refer to the information provided in E19-13....Ch. 19 - Prob. 15ECh. 19 - Prob. 16ECh. 19 - Prob. 1PCh. 19 - Prob. 2PCh. 19 - Prob. 3PCh. 19 - Prob. 4PCh. 19 - Prob. 5PCh. 19 - Prob. 6PCh. 19 - Prob. 7PCh. 19 - Prob. 8PCh. 19 - Prob. 9PCh. 19 - Prob. 10PCh. 19 - Prob. 11PCh. 19 - Prob. 12PCh. 19 - Prob. 1CCh. 19 - Prob. 2CCh. 19 - Prob. 3CCh. 19 - Prob. 4CCh. 19 - Prob. 5CCh. 19 - Prob. 6CCh. 19 - Prob. 7CCh. 19 - Prob. 9C
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- Henning Company sponsors a defined benefit pension plan for its employees. The following data relate to the operation of the plan for the year 2020 in which no benefits were paid. The actuarial present value of future benefits earned by employees for services rendered in 2020 amounted to $56,000. The company's funding policy requires a contribution to the pension trustee amounting to $145,000 for 2020. As of January 1, 2020, the company had a projected benefit obligation of $900,000, an accumulated benefit obligation of $800,000, and a debit balance of $400,000 in accumulated OCI (PSC). The fair value of pension plan assets amounted to $600,000 at the beginning of the year. The actual and expected return on plan assets was $54,000. The settlement rate was 9%. No gains or losses occurred in 2020 and no benefits were paid. Amortization of prior service cost was $50,000 in 2020. Amortization of net gain or loss was not required in 2020. Instructions Determine the amounts of the…arrow_forwardCompany G offers a defined benefit pension plan to its employees. At December 31, 2018, the present value of the defined benefit obligation of the pension plan was $7,800,000 and the fair value of the plan assets was $8,000,000. Information pertaining to the pension plan in 2019 follows: The actuary advised that current service cost was $900,000. The discount rate used in actuarial assumptions was 5%. On June 1, 2019, Company G retroactively improved the benefits under the plan to January 1, 2019. The cost of this improvement was determined by the plan actuary to be $975,000. Benefits paid to retirees on July 1, 2019 were $750,000. Company G contributed $675,000 to the pension plan on March 1, 2019. The present value of the defined benefit obligation at December 31, 2019, was $8,125,000. The fair market value of plan assets as at December 31, 2019, was $8,375,000. • Company G has a December 31 year end. Required: • Prepare the worksheet and journal entries for 2019 using IFRS. •…arrow_forwardOn December 31, 2019, Berry Company determined that the 2019 service cost on its defined benefit pension plan was $140,000. At the beginning of 2019, Berry had pension plan assets of $510,000 and a projected benefit obligation of $700,000. Its discount rate (and expected long-term rate of return on plan assets) for 2019 was 10%. There are no other components of Berry's pension expense; the company had an accrued/prepaid pension cost liability at the end of 2018. Required: 1. Compute the amount of Berry's pension expense for 2019. 2. Prepare the journal entry to record Berry's 2019 pension expense if it funds the pension plan in the amount of (a) $159,000 and (b) $140,000.arrow_forward
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