INTERMEDIATE ACCOUNTING(LL)-W/2 ACCESS
9th Edition
ISBN: 9781260180657
Author: SPICELAND
Publisher: MCG
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Question
Chapter 17, Problem 17.10E
(1)
To determine
Pension expense: Pension expense is an expense to the employer paid as compensation after the completion of services performed by the employees.
Pension expense includes the following components:
- Service cost
- Interest cost
- Expected return on plan assets
- Amortization of prior service cost
- Amortization of net loss or net gain
To compute: Pension expense of Company AA for the year 2018
(2)
To determine
Debit and credit rules:
- Debit an increase in asset account, increase in expense account, decrease in liability account, and decrease in
stockholders’ equity accounts. - Credit decrease in asset account, increase in revenue account, increase in liability account, and increase in stockholders’ equity accounts.
To journalize: Pension expense, if service cost is $20,000,000, interest cost is $12,000,000, and expected return on assets is $8,000,000
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Exercise 17-10 (Algo) Determine pension expense [LO17-6, 17-7]
Abbott and Abbott has a noncontributory, defined benefit pension plan. At December 31, 2021, Abbott and Abbott received the
following information:
Projected Benefit Obligation
Balance, January 1
Service cost
($ in millions)
$125
22
Interest cost
15
Benefits paid
(8)
Balance, December 31
$154
Plan Assets
Balance, January 1
Actual return on plan assets
$75
10
Contributions 2021
22
Benefits paid
|(8)
Balance, December 31
$99
The expected long-term rate of return on plan assets was 12%. There was no prior service cost and a negligible net loss-AOCI on
January 1, 2021.
Required:
1. Determine Abbott and Abbott's pension expense for 2021.
2 Prenare the iournal entries to record Abbott ancd Abbott's a) pension expense (6) fundina and (c) pavment for 2021
Exercise 17-10 (Algo) Determine pension expense [LO17-6, 17-7]
Abbott and Abbott has a noncontributory, defined benefit pension plan. At December 31, 2021, Abbott and Abbott recei
following information:
Projected Benefit Obligation
Balance, January 1
($ in millions)
$125
Service cost
Interest cost
22
Benefits paid
15
(8)
Balance, December 31
$154
Plan Assets
Balance, January 1
Actual return on plan assets
Contributions 2021
Benefits paid
$75
10
22
(8)
Balance, December 31
$99
The expected long-term rate of return on plan assets was 12%. There was no prior service cost and a negligible net loss-A
January 1, 2021.
Required:
1. Determine Abbott and Abbott's pension expense for 2021.
2. Prepare the journal entries to record Abbott and Abbott's (a) pension expense, (b) funding, and (c) payment for 2021.
Question 19
Tyson, Inc sponsors a defined-benefit pension plan. The following data relates to the operation of the plan for the year 2021.
Service cost
$345.000
330,000
270.000
Plan contributions
Actual return on plan assets
Projected benefit obligation January 1
Fair value of plan assets, January 1
3,600,000
2,400,000
The expected return on plan assets and the settlement rate were both 10%. The amount of pension expense reported for 2021 is:
OA$705,000
OR$465,000
Oc$435.000
OD$345.000
Chapter 17 Solutions
INTERMEDIATE ACCOUNTING(LL)-W/2 ACCESS
Ch. 17 - Prob. 17.1QCh. 17 - Prob. 17.2QCh. 17 - Prob. 17.3QCh. 17 - What is the vested benefit obligation?Ch. 17 - Prob. 17.5QCh. 17 - Prob. 17.6QCh. 17 - Name three events that might change the balance of...Ch. 17 - Prob. 17.8QCh. 17 - Prob. 17.9QCh. 17 - Prob. 17.10Q
Ch. 17 - The return on plan assets is the increase in plan...Ch. 17 - Define prior service cost. How is it reported in...Ch. 17 - Prob. 17.13QCh. 17 - Is a companys PBO reported in the balance sheet?...Ch. 17 - What two components of pension expense may be...Ch. 17 - Prob. 17.16QCh. 17 - Evaluate this statement: The excess of the actual...Ch. 17 - Prob. 17.18QCh. 17 - TFC Inc. revises its estimate of future salary...Ch. 17 - Prob. 17.20QCh. 17 - Prob. 17.21QCh. 17 - Prob. 17.22QCh. 17 - The components of postretirement benefit expense...Ch. 17 - The EPBO for Branch Industries at the end of 2018...Ch. 17 - Prob. 17.25QCh. 17 - Prob. 17.26QCh. 17 - Prob. 17.1BECh. 17 - Prob. 17.2BECh. 17 - Prob. 17.3BECh. 17 - Prob. 17.4BECh. 17 - Prob. 17.5BECh. 17 - Prob. 17.6BECh. 17 - Prob. 17.7BECh. 17 - Prob. 17.8BECh. 17 - Prob. 17.9BECh. 17 - Prob. 17.10BECh. 17 - Net gain LO176 The projected benefit obligation...Ch. 17 - Prob. 17.12BECh. 17 - Prob. 17.13BECh. 17 - Postretirement benefits; determine the APBO and...Ch. 17 - Prob. 17.15BECh. 17 - Prob. 17.1ECh. 17 - Prob. 17.2ECh. 17 - Prob. 17.3ECh. 17 - Prob. 17.4ECh. 17 - Prob. 17.5ECh. 17 - Prob. 17.6ECh. 17 - Prob. 17.7ECh. 17 - Prob. 17.8ECh. 17 - Prob. 17.9ECh. 17 - Prob. 17.10ECh. 17 - Prob. 17.11ECh. 17 - PBO calculations; ABO calculations; present value...Ch. 17 - Prob. 17.13ECh. 17 - Prob. 17.14ECh. 17 - Prob. 17.15ECh. 17 - Prob. 17.16ECh. 17 - Prob. 17.17ECh. 17 - Prob. 17.18ECh. 17 - Prob. 17.19ECh. 17 - Prob. 17.20ECh. 17 - Prob. 17.21ECh. 17 - Prob. 17.22ECh. 17 - Prob. 17.23ECh. 17 - Prob. 17.24ECh. 17 - Prob. 17.25ECh. 17 - Prob. 17.26ECh. 17 - Prob. 17.27ECh. 17 - Prob. 17.28ECh. 17 - Prob. 17.29ECh. 17 - Prob. 17.30ECh. 17 - Prob. 17.31ECh. 17 - Prob. 17.32ECh. 17 - Prob. 17.33ECh. 17 - Prob. 17.1PCh. 17 - PBO calculations; present value concepts LO173...Ch. 17 - Service cost, interest, and PBO calculations;...Ch. 17 - Prob. 17.4PCh. 17 - Prob. 17.5PCh. 17 - Prob. 17.6PCh. 17 - Determining the amortization of net gain LO176...Ch. 17 - Prob. 17.8PCh. 17 - Prob. 17.9PCh. 17 - Prob. 17.10PCh. 17 - Prob. 17.11PCh. 17 - Prob. 17.12PCh. 17 - Prob. 17.13PCh. 17 - Prob. 17.14PCh. 17 - Prob. 17.15PCh. 17 - Prob. 17.16PCh. 17 - Prob. 17.17PCh. 17 - Prob. 17.18PCh. 17 - Prob. 17.19PCh. 17 - Prob. 17.20PCh. 17 - Prob. 17.21PCh. 17 - Prob. 17.1BYPCh. 17 - Prob. 17.2BYPCh. 17 - Prob. 17.3BYPCh. 17 - Prob. 17.5BYPCh. 17 - Prob. 17.6BYPCh. 17 - Prob. 17.7BYPCh. 17 - Prob. 17.8BYPCh. 17 - Prob. 17.9BYPCh. 17 - Prob. 17.11BYPCh. 17 - Prob. 1CCTCCh. 17 - Prob. 1CCIFRS
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