mber Company has 120 employees who are expected to receive benefits under the company's defined-benefit pension plan. The total number of service-years of these employees is 1,200. The actuary for the company's pension plan calculated the following net gains and losses: For the Year Ended December 31 (Gain) Or Loss 2020 $560,000 2021 (474,000) 2022 910,000
mber Company has 120 employees who are expected to receive benefits under the company's defined-benefit pension plan. The total number of service-years of these employees is 1,200. The actuary for the company's pension plan calculated the following net gains and losses: For the Year Ended December 31 (Gain) Or Loss 2020 $560,000 2021 (474,000) 2022 910,000
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
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Question
Cullumber Company has 120 employees who are expected to receive benefits under the company's defined-benefit pension plan. The total number of service-years of these employees is 1,200. The actuary for the company's pension plan calculated the following net gains and losses:
Prior to 2020, there was no unrecognized net gain or loss.
Information about the company's projected benefit obligation and market-related (and fair) value of plan assets follows:
Based on the above information about Cullumber Company, prepare a schedule which reflects the amount of net gain or loss to be amortized by the company as a component of pension expense for the years 2020, 2021, and 2022. The company amortizes net gains or losses using the straight-line method over the average service life of participating employees.
For the Year Ended December 31 |
(Gain) Or Loss | ||
2020 | $560,000 | ||
2021 | (474,000) | ||
2022 | 910,000 |
Prior to 2020, there was no unrecognized net gain or loss.
Information about the company's projected benefit obligation and market-related (and fair) value of plan assets follows:
As of January 1 | ||||||
2020 | 2021 | 2022 | ||||
Projected benefit obligation | $2,020,000 | $2,260,000 | $2,860,000 | |||
Fair value of plan assets | 1,600,000 | 2,380,000 | 2,470,000 |
Based on the above information about Cullumber Company, prepare a schedule which reflects the amount of net gain or loss to be amortized by the company as a component of pension expense for the years 2020, 2021, and 2022. The company amortizes net gains or losses using the straight-line method over the average service life of participating employees.
Beginning of Year
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Projected Benefit
Obligation |
Plan
Assets |
Corridor
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Accumulated
OCI (Gain/Loss) |
Amortization
|
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2020 |
$
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$
|
$
|
$
|
$
|
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2021 |
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|
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2022 |
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