Bostonian Company provided the following information related to its defined benefit pension plan for 20X1: PBO on 1/1 $ 2,500,000 Fair value of plan assets on 1/1 2,000,000 Service cost 120,000 Actual return on plan assets 320,000 Payments made to retirees on 12/31 100,000 Amortization of prior service cost 40,000 Recognized actuarial losses 50,000 Contributions made to plan at 12/31 80,000 Interest rate for discounting pension obligations 6 % Expected return on plan assets 8 %
Bostonian Company provided the following information related to its defined benefit pension plan for 20X1: PBO on 1/1 $ 2,500,000 Fair value of plan assets on 1/1 2,000,000 Service cost 120,000 Actual return on plan assets 320,000 Payments made to retirees on 12/31 100,000 Amortization of prior service cost 40,000 Recognized actuarial losses 50,000 Contributions made to plan at 12/31 80,000 Interest rate for discounting pension obligations 6 % Expected return on plan assets 8 %
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 9MC
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Question
Bostonian Company provided the following information related to its defined benefit pension plan for 20X1:
| PBO on 1/1 | $ | 2,500,000 | |
| Fair value of plan assets on 1/1 | 2,000,000 | ||
| Service cost | 120,000 | ||
| Actual return on plan assets | 320,000 | ||
| Payments made to retirees on 12/31 | 100,000 | ||
| Amortization of prior service cost | 40,000 | ||
| Recognized actuarial losses | 50,000 | ||
| Contributions made to plan at 12/31 | 80,000 | ||
| Interest rate for discounting pension obligations | 6 | % | |
| Expected return on plan assets | 8 | % | |
Required:
- What amount was recognized in OCI in 20X1? Be sure to indicate whether OCI amount represented a loss or a (gain).
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Bostonian Company provided the following information related to its defined benefit pension plan for 20X1:
| PBO on 1/1 | $ | 2,500,000 | |
| Fair value of plan assets on 1/1 | 2,000,000 | ||
| Service cost | 120,000 | ||
| Actual return on plan assets | 320,000 | ||
| Payments made to retirees on 12/31 | 100,000 | ||
| Amortization of prior service cost | 40,000 | ||
| Recognized actuarial losses | 50,000 | ||
| Contributions made to plan at 12/31 | 80,000 | ||
| Interest rate for discounting pension obligations | 6 | % | |
| Expected return on plan assets | 8 | % | |
- What amount of pension expense should Bostonian report for 20X1?
- What is the fair value of plan assets at December 31, 20X1?
- What amount was recognized in OCI in 20X1? Be sure to indicate whether OCI amount represented a loss or a (gain).
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