plan Generous Company has established a defined benefit p The employee's final salary at retirement is expeçted to be expected to retire on December 31, 2044. The employee's An employee was hired by the entity on January 1, 2000 and the final year's salary. The annual benefit is payable at the indicating a plan formula for annual benefit equal to 2% multiplied by the number of years in service multiplied b by end of each year. expected to retire on December 31, 2044 The retirement is expected to span 21 years. ate is 8%
plan Generous Company has established a defined benefit p The employee's final salary at retirement is expeçted to be expected to retire on December 31, 2044. The employee's An employee was hired by the entity on January 1, 2000 and the final year's salary. The annual benefit is payable at the indicating a plan formula for annual benefit equal to 2% multiplied by the number of years in service multiplied b by end of each year. expected to retire on December 31, 2044 The retirement is expected to span 21 years. ate is 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 4E
Related questions
Question
Transcribed Image Text:3. What is the past service cost for 2020 as a result of the
multiplied by the number of years in service multiplied E
The employee's final salary at retirement is expected to be
the final year's salary. The annual benefit is payable at the
indicating a plan formula for annual benefit equal to 2%
2. What is the projected benefit obligation after amendment
increasing the percentage from 2% to 3%. The amendment
On January l, 2020, the plan formula was amended by
expected to retire on December 31, 2044. The employee's
Generous Company has established a defined benefit plan
Problem 17-13 (IAA)
Generous Company has established a defined
by
end of each year.
s hired by the entity on January 1, 2000
An employee was
retirement is expected to span 21 years.
P800,000 and the appropriate discount rate is 8%
On January 1, 2020, the plan formula was amended .
increasing the percentage from 2% to 3%. The amendment
was made retroactive to consider past service years.
The present value of an ordinary annuity of 1 at 8% for 21
periods is 10.02 and the present value of 1 at 8% for 25 periods
is 0.15.
1. What is the projected benefit obligation before
amendment on January 1, 2020?
a. 480,960
b. 320,000
c. 160,000
d. 400,000
2. What is the projected benefit obligation after amendment
on January 1, 2020?
a. 480,000
b. 721,440
c. 240,000
d. 320,640
amendment?
160,000
b. 120,240
c. 240,480
d.
а.
с.
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