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 balance sheet

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Answer 1

Question

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 17, Problem 17.3BYP

(1)

To determine

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 balance sheet

(2)

To determine

To mention: The amounts that would be reported as net pension liability on the balance sheet

(3)

To determine

To mention: The amounts that would be reported as net pension asset on the balance sheet

(4)

To determine

To indicate: The other items which were reported on disclosure notes were reported on balance sheet

(5)

To determine

To discuss: The item reported as ‘actuarial gain’ and ‘actuarial loss’ in the notes to financial statements

(6)

To determine

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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Question 17 Swifty Company sponsors a defined benefit pension plan for its employees. The following data relate to the operation of the plan for the year 2020 in which no benefits were paid. 1. The actuarial present value of future benefits earned by employees for services rendered in 2020 amounted to $55,500. 2. The company’s funding policy requires a contribution to the pension trustee amounting to $144,729 for 2020. 3. As of January 1, 2020, the company had a projected benefit obligation of $908,100, an accumulated benefit obligation of $802,100, and a debit balance of $400,100 in accumulated OCI (PSC). The fair value of pension plan assets amounted to $601,200 at the beginning of the year. The actual and expected return on plan assets was $54,100. The settlement rate was 9%. No gains or losses occurred in 2020 and no benefits were paid. 4. Amortization of prior service cost was $50,500 in 2020. Amortization of net gain or loss was not required in 2020. (c)…

QUESTION 3 Bacon Bad is a national diner that has set up a defined benefit pension plan for its employees. The company uses IFRS and has provided you with the following information pertaining to its pension plan: Pension obligation, December 31,2021 - $6854203 Plan assets, December 31, 2021 - $5906519 Interest rate on pension obligations - 3% Current service cost for the year (accrued at the end of the year) - $598059 Improvement in pension plan, effective on January 1, 2022 - $62000 Actuarial gain on change in assumptions - $0 Expected retum on plan assets -3% of plan assets Actual return on plan assets - $271186 Amounts remitted by employer to pension trust on January 1,2022 - $668416 Payments we do not need payment to retiree

Question 19 Which of the following correctly describes defined benefit (DB) pension plans? A- A typical example of DB plan is 401(K) savings account B- Retirement benefits depend on how much money has accumulated in an individual's account. C- Employers never need to report a liability related to DB plans D- Retirement benefits are based on the plan benefit formula. O A O B

Answer 2

Question

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 17, Problem 17.3BYP

(1)

To determine

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 balance sheet

(2)

To determine

To mention: The amounts that would be reported as net pension liability on the balance sheet

(3)

To determine

To mention: The amounts that would be reported as net pension asset on the balance sheet

(4)

To determine

To indicate: The other items which were reported on disclosure notes were reported on balance sheet

(5)

To determine

To discuss: The item reported as ‘actuarial gain’ and ‘actuarial loss’ in the notes to financial statements

(6)

To determine

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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Answer 3

Question

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 17, Problem 17.3BYP

(1)

To determine

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 balance sheet

(2)

To determine

To mention: The amounts that would be reported as net pension liability on the balance sheet

(3)

To determine

To mention: The amounts that would be reported as net pension asset on the balance sheet

(4)

To determine

To indicate: The other items which were reported on disclosure notes were reported on balance sheet

(5)

To determine

To discuss: The item reported as ‘actuarial gain’ and ‘actuarial loss’ in the notes to financial statements

(6)

To determine

To indicate: The components of pension expense which represent deferred recognition, and indicate where would these items be reported before being amortized

Expert Solution & Answer

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Answer 4

Question

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 17, Problem 17.3BYP

(1)

To determine

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 balance sheet

(2)

To determine

To mention: The amounts that would be reported as net pension liability on the balance sheet

(3)

To determine

To mention: The amounts that would be reported as net pension asset on the balance sheet

(4)

To determine

To indicate: The other items which were reported on disclosure notes were reported on balance sheet

(5)

To determine

To discuss: The item reported as ‘actuarial gain’ and ‘actuarial loss’ in the notes to financial statements

(6)

To determine

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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Answer 5

Chapter 17, Problem 17.3BYP

(1)

To determine

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 balance sheet

(2)

To determine

To mention: The amounts that would be reported as net pension liability on the balance sheet

(3)

To determine

To mention: The amounts that would be reported as net pension asset on the balance sheet

(4)

To determine

To indicate: The other items which were reported on disclosure notes were reported on balance sheet

(5)

To determine

To discuss: The item reported as ‘actuarial gain’ and ‘actuarial loss’ in the notes to financial statements

(6)

To determine

To indicate: The components of pension expense which represent deferred recognition, and indicate where would these items be reported before being amortized

Answer 6

Chapter 17, Problem 17.3BYP

(1)

To determine

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 balance sheet

Answer 7

Chapter 17, Problem 17.3BYP

(1)

To determine

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 balance sheet

Answer 8

(2)

To determine

To mention: The amounts that would be reported as net pension liability on the balance sheet

Answer 9

(2)

To determine

To mention: The amounts that would be reported as net pension liability on the balance sheet

Answer 10

(3)

To determine

To mention: The amounts that would be reported as net pension asset on the balance sheet

Answer 11

(3)

To determine

To mention: The amounts that would be reported as net pension asset on the balance sheet

Answer 12

(4)

To determine

To indicate: The other items which were reported on disclosure notes were reported on balance sheet

Answer 13

(4)

To determine

To indicate: The other items which were reported on disclosure notes were reported on balance sheet

Answer 14

(5)

To determine

To discuss: The item reported as ‘actuarial gain’ and ‘actuarial loss’ in the notes to financial statements

Answer 15

(5)

To determine

To discuss: The item reported as ‘actuarial gain’ and ‘actuarial loss’ in the notes to financial statements

Answer 16

(6)

To determine

To indicate: The components of pension expense which represent deferred recognition, and indicate where would these items be reported before being amortized

Answer 17

(6)

To determine

To indicate: The components of pension expense which represent deferred recognition, and indicate where would these items be reported before being amortized

Answer 18

Expert Solution & Answer

Answer 19

Expert Solution & Answer

Answer 20

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Answer 21

Ch. 17 - Prob. 17.1Q Ch. 17 - Prob. 17.2Q Ch. 17 - Prob. 17.3Q Ch. 17 - What is the vested benefit obligation?Ch. 17 - Prob. 17.5Q Ch. 17 - Prob. 17.6Q Ch. 17 - Name three events that might change the balance of...Ch. 17 - Prob. 17.8Q Ch. 17 - Prob. 17.9Q Ch. 17 - Prob. 17.10Q

Solution Summary: The author explains that pension expense is not computed based on the items derived from the balance sheet.

Concept explainers

To mention: The amounts that would be reported as net pension liability on the balance sheet

To mention: The amounts that would be reported as net pension asset on the balance sheet

To indicate: The other items which were reported on disclosure notes were reported on balance sheet

To discuss: The item reported as ‘actuarial gain’ and ‘actuarial loss’ in the notes to financial statements

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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Chapter 17 Solutions