On January 1, 2021, Gillock Climbing Academy instituted a defined benefit pension plan for its employees. The annual service cost for each year of 2021 and 2022 was $790,000. The interest rate used to determine the projected benefit obligation is 12%. Both the actual and the expected return on plan assets are 10% for both years. Gillock funded the plan in the amount of $590,000 each January 1, beginning on January 1, 2021. What pension liability should Gillock report in its balance sheet for the year ended December 31, 2022? Multiple Choice $501.500 $311,900 $370,900 $406,700
On January 1, 2021, Gillock Climbing Academy instituted a defined benefit pension plan for its employees. The annual service cost for each year of 2021 and 2022 was $790,000. The interest rate used to determine the projected benefit obligation is 12%. Both the actual and the expected return on plan assets are 10% for both years. Gillock funded the plan in the amount of $590,000 each January 1, beginning on January 1, 2021. What pension liability should Gillock report in its balance sheet for the year ended December 31, 2022? Multiple Choice $501.500 $311,900 $370,900 $406,700
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 2MC
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Transcribed Image Text:On January 1, 2021, Gillock Climbing Academy instituted a defined benefit pension plan for its employees. The annual service cost for each
year of 2021 and 2022 was $790,000. The interest rate used to determine the projected benefit obligation is 12%. Both the actual and the
expected return on plan assets are 10% for both years. Gillock funded the plan in the amount of $590,000 each January 1, beginning on
January 1, 2021.
What pension liability should Gillock report in its balance sheet for the year ended December 31, 2022?
Multiple Choice
$501,500
$311.900
$370.900
$406,700
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