Headland Company adopts acceptable accounting for its defined benefit pension plan on January 1, 2019, with the following beginning balances: plan assets $201,400; projected benefit obligation $245,000. Other data relating to 3 years’ operation of the plan are as follows. 2019 2020 2021 Annual service cost $15,800 $19,400 $26,100 Settlement rate and expected rate of return 10 % 10 % 10 % Actual return on plan assets 18,000 22,150 24,000 Annual funding (contributions) 15,800 40,000 47,500 Benefits paid 13,700 16,500 20,800 Prior service cost (plan amended, 1/1/20) 160,000 Amortization of prior service cost 53,800 41,700 Change in actuarial assumptions establishes a December 31, 2021, projected benefit obligation of: 522,200 (a) Prepare a pension worksheet presenting all 3 years’ pension balances and activities. (Enter all amounts as positive.) HEADLAND COMPANY Pension Worksheet—2019, 2020, 2021 General Journal Entries Memo Record Annual Pension Expense Cash OCI—Prior
Headland Company adopts acceptable accounting for its defined benefit pension plan on January 1, 2019, with the following beginning balances: plan assets $201,400; projected benefit obligation $245,000. Other data relating to 3 years’ operation of the plan are as follows. 2019 2020 2021 Annual service cost $15,800 $19,400 $26,100 Settlement rate and expected rate of return 10 % 10 % 10 % Actual return on plan assets 18,000 22,150 24,000 Annual funding (contributions) 15,800 40,000 47,500 Benefits paid 13,700 16,500 20,800 Prior service cost (plan amended, 1/1/20) 160,000 Amortization of prior service cost 53,800 41,700 Change in actuarial assumptions establishes a December 31, 2021, projected benefit obligation of: 522,200 (a) Prepare a pension worksheet presenting all 3 years’ pension balances and activities. (Enter all amounts as positive.) HEADLAND COMPANY Pension Worksheet—2019, 2020, 2021 General Journal Entries Memo Record Annual Pension Expense Cash OCI—Prior
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 1E
Related questions
Question
10.
Headland Company adopts acceptable accounting for its defined benefit pension plan on January 1, 2019, with the following beginning balances: plan assets $201,400; projected benefit obligation $245,000. Other data relating to 3 years’ operation of the plan are as follows.
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2019
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2020
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2021
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| Annual service cost | $15,800 | $19,400 | $26,100 | ||||||
| Settlement rate and expected |
10 | % | 10 | % | 10 | % | |||
| Actual return on plan assets | 18,000 | 22,150 | 24,000 | ||||||
| Annual funding (contributions) | 15,800 | 40,000 | 47,500 | ||||||
| Benefits paid | 13,700 | 16,500 | 20,800 | ||||||
| Prior service cost (plan amended, 1/1/20) | 160,000 | ||||||||
| Amortization of prior service cost | 53,800 | 41,700 | |||||||
| Change in actuarial assumptions establishes a December 31, 2021, projected benefit obligation of: |
522,200 |
(a)
Prepare a pension worksheet presenting all 3 years’ pension balances and activities. (Enter all amounts as positive.)
|
HEADLAND COMPANY
Pension Worksheet—2019, 2020, 2021 |
||||||
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General
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Memo Record
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|||||
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Annual Pension
Expense |
Cash
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OCI—Prior
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Expert Solution
Step 1 Introduction
Pension Obligation: There are three alternative methods to estimate the future spending or obligations connected with a pension plan, and the word "pension obligation" may apply to any of them. In general, pension liabilities may be expressed in terms of accrued, vested, and anticipated benefits, with cumulative benefits being the most common.
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