Concept explainers
(1)
Pension plan: This is the plan devised by corporations to pay the employees an income after their retirement, in the form of pension.
Pension expense: Pension expense is an expense to the employer paid as compensation after the completion of services performed by the employees.
To discuss: Whether the pension expense is computed based on the amounts that are not reported on the
(2)
To mention: The amounts that would be reported as net pension liability on the balance sheet
(3)
To mention: The amounts that would be reported as net pension asset on the balance sheet
(4)
To indicate: The other items which were reported on disclosure notes were reported on balance sheet
(5)
To discuss: The item reported as ‘actuarial gain’ and ‘actuarial loss’ in the notes to financial statements
(6)
To indicate: The components of pension expense which represent deferred recognition, and indicate where would these items be reported before being amortized
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INTERMEDIATE ACCOUNTING(LL)-W/CONNECT
- Question 11 The following data are for the pension plan for the employees of Cullumber Company. 1/1/20 12/31/20 12/31/21 Accumulated benefit obligation $ 5400000 $ 5410000 $ 6850000 Projected benefit obligation 5560000 5770000 7530000 Plan assets (at fair value) 4600000 6230000 6780000 AOCL – net loss 0 975000 1000000 Settlement rate (for year) 9% 10% Expected rate of return (for year) 9% 8% Cullumber’s contribution was $861000 in 2021 and benefits paid were $751000. Cullumber estimates that the average remaining service life is 15 years.The actual return on plan assets in 2021 was $550000. $360000. $440000. $430000.arrow_forward3arrow_forwardQuestion 7 Union dues can be collected to cover the following: a Administration b) Social Fund c) Special Fund . d) Initiation e) Insurance Question 8 It's common for benefits rates to change on an basis. Question 9 Garnishment rules are the same in every jurisdiction. True • False Question 10 An employee can typically opt out of contributing to a company pension plan True • False Question 11 RRSP stands for O a) Regulated Retirement Savings Pension b) Registered Retirement Savings Pension c) Regulated Retirement Savings Plan d) Registered Regulated Savings Plan e) Registered Retirement Savings Plan O O O Carrow_forward
- QUESTION 18 A tax-advantaged pension plan, such as a 401(k), that both employer and employee may contribute that allows for retirement saving is called a: defined contribution defined benefit plan O a pension plan All of these are truearrow_forward22arrow_forwardQuestion text Dickson Manufacturing Corp., a company reporting under IFRS, has a defined benefit pension plan. Pension information concerning the 2020 fiscal year is presented below (in millions): Information provided by the pension plan trustee Fair value of plan assets, January 1, 2020 $1,600 Actual return on plan assets, 2020 224 The discount rate used in actuarial assumptions is 10%. What is the balance of the plan assets as at December 31, 2020? Select one: 17 а. $1,664 b. $1,824 c. $1,376 d. $1,760arrow_forward
- 20 Question 21 A debit balance in a company's Pension Asset/Liability account implies that the company has funded more than the amount Expensed since the pension plan was initiated. O True O Falsearrow_forwardExercise 17-10 (Algo) Determine pension expense Abbott and Abbott has a noncontributory, defined benefit pension plan. At December 31, 2021, Abbott and Abbott received the following information: Projected Benefit Obligation Balance, January 1 Service cost ($ in millions) $125 22 Interest cost Benefits paid 15 (8) Balance, December 31 $154 Plan Assets Balance, January 1 Actual return on plan assets Contributions 2021 Benefits paid Balance, December 31 $75 10 22 (8) $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 Prepare the journal entries to record Abbott and Abbott's (a) pension expense, (b) fundina, and (c) pavment for 2021.arrow_forwardQuestion 1: EMPLOYEE BENEFITSarrow_forward
- _1. If a company has an underfunded defined-benefit pension plan: A. no payment may be made to retirees until the company deposits all the necessary assets into the pension fund. B. the difference between fund assets and amounts owed to retirees will still be paid by the federal Pension Benefit Guaranty Corporation. C. the value of the PBO must be precisely the same as the amount of assets set aside by the company to pay pension benefits. D. All the above are true. E. None of the above is true. 2. Which of the following is a TRUE sentence with regard to a defined-contribution pension plan? A. Both the employer and employee must make annual payments to the plan. B. It does not matter to the employee whether the company has a defined- benefit plan or a defined-contribution plan, because the employee still has retirement benefits. C. A 401(k) plan is an example of a defined-contribution plan. D. All the above are true. E. None of the above is true. _3. The Public Company Accounting…arrow_forwardQuestion 17 S1: Employee-sponsored retirement plans can be categorized into two: current service cost and projected benefit obligation. S2: Liabilities pertains to the settlements which resulted in an outflow of resources embodying economic benefits. S3: PAS 19, provides that only the unvested past service costs shall be recognized as expense immediately. one statement is true two of the statements are true all statements are false all statements are truearrow_forward130 A B D G H K L M N P 1 ACCT328, HW 2 Due no later than Mar 13, 2022 11:55 PM: After deducting an RPP contribution of $2,000, Mrs. Blue has net employment income of $34,000 in the previous year. Her employer reports a Pension Adjustment of $4,500 on her previous year's T4. Her current year's RRSP contributions total $5,000. At the end of the previous year her 6 Unused RRSP Deduction Room was $2,500. 9 Required: What is the maximum RRSP deduction that Mrs. Blue can take on her current year's tax return? 10 11 12 Solution: 13 14 15 16 17 18 19 20 21 22 23 24 25 30 31arrow_forward
- Individual Income TaxesAccountingISBN:9780357109731Author:HoffmanPublisher:CENGAGE LEARNING - CONSIGNMENTIntermediate Accounting: Reporting And AnalysisAccountingISBN:9781337788281Author:James M. Wahlen, Jefferson P. Jones, Donald PagachPublisher:Cengage Learning