Goodday Ltd. has a defined benefit pension plan and a December 31 year-end. The following Balances: Defined benefit obligation, end of 20X7 Pension plan assets, fair value, end of 20X7 $5,215,000 4,810,000 SFP net defined benefit liability, end of 20X7 SFP accumulated OCI, pension, end of 20X7 Retained eamings, end of 20X7 20X8 eamings, prior to any pension expense Current service cost for 20X8, measured using the projected unit credit method 405,000 cr. 69,200 dr. 8,601,400 cr. 4,200,000 cr. 601,900 New past service cost granted in 20X8, negative because benefits were reduced and the liability has declined Contributions made to the pension plan assets paid at end of 20X8 Actuarial gain in 20X8, negative because caused by higher anticipated future mortality rates and the liability has declined Actual earnings in the fund, reported by the pension fund trustee, including interest, dividends, and change in fair value Benefits paid to pensioners from Pension fund assets paid at end of 20X8 Interest rate on long-term corporate bonds, end of 20X8 (356,000) 450,000 (106,000) 144,800 67,900 5 % Required: Calculate the balances of the defined benefit obligation and the pension plan assets at the er at the end of 20X8. Defined benefit obligation Pension plan assets Net defined benefit pension plan liability
Goodday Ltd. has a defined benefit pension plan and a December 31 year-end. The following Balances: Defined benefit obligation, end of 20X7 Pension plan assets, fair value, end of 20X7 $5,215,000 4,810,000 SFP net defined benefit liability, end of 20X7 SFP accumulated OCI, pension, end of 20X7 Retained eamings, end of 20X7 20X8 eamings, prior to any pension expense Current service cost for 20X8, measured using the projected unit credit method 405,000 cr. 69,200 dr. 8,601,400 cr. 4,200,000 cr. 601,900 New past service cost granted in 20X8, negative because benefits were reduced and the liability has declined Contributions made to the pension plan assets paid at end of 20X8 Actuarial gain in 20X8, negative because caused by higher anticipated future mortality rates and the liability has declined Actual earnings in the fund, reported by the pension fund trustee, including interest, dividends, and change in fair value Benefits paid to pensioners from Pension fund assets paid at end of 20X8 Interest rate on long-term corporate bonds, end of 20X8 (356,000) 450,000 (106,000) 144,800 67,900 5 % Required: Calculate the balances of the defined benefit obligation and the pension plan assets at the er at the end of 20X8. Defined benefit obligation Pension plan assets Net defined benefit pension plan liability
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter19: Accounting For Post Retirement Benefits
Section: Chapter Questions
Problem 6RE
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Transcribed Image Text:Goodday Ltd. has a defined benefit pension plan and a December 31 year-end. The following information relates to the plan:
Balances:
Defined benefit obligation, end of 20X7
Pension plan assets, fair value, end of 20X7
$5,215,000
4.810,000
405,000 cr.
69,200 dr.
8,601,400 cr
4.200,000 cr.
SFP net defined benefit liability, end of 20X7
SFP accumulated OCI, pension, end of 20X7
Retained earnings, end of 20X7
20X8 eamings, prior to any pension expense
Current service cost for 20X8, measured using the projected
unit credit method
New past service cost granted in 20X8, negative because
benefits were reduced and the liability has declined
Contributions made to the pension plan assets paid at end of
601,900
(356,000)
20X8
450,000
Actuarial gain in 20X8, negative because caused by higher
anticipated future mortality rates and the liability has declined
Actual earnings in the fund, reported by the pension fund trustee,
including interest, dividends, and change in fair value
Benefits paid to pensioners from Pension fund assets paid at
end of 20X8
Interest rate on long-term corporate bonds, end of 20X8
(106,000)
144,800
67,900
5 %
Required:
Calculate the balances of the defined benefit obligation and the pension plan assets at the end of 20X8. Use these values to calculate the SFP net defined benefit plan element for Goodday
at the end of 20X8.
Defined benefit obligation
Pension plan assets
Net defined benefit pension plan liability
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