INTERMEDIATE ACCOUNTING
10th Edition
ISBN: 9781264046249
Author: SPICELAND
Publisher: MCG
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Question
Chapter 17, Problem 17.3E
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 indicate: Whether each of the following events listed below increases, decreases, or has no effect on an employer’s periodic expense in the year the event occurs.
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Question 14
what give rises to the changes in PBO balance?
A- service cost and interest cost
B- prior service cost that is caused by a change in pension formula
C- changes in life expectancy estimates
D- all of the above
O A
O C
OD
Indicate by letter whether each of the events listed below increases (I), decreases (D), or has no effect (N) on an employer's periodic pension expense in the year the event occurs.
Events
1. Interest cost. _____
2. Amortization of prior service cost---AOCI. ______
3.Excess of the expected return on plan assets over the actual return _____
4. Expected return on plan assets. _____
5. A plan amendment that increases benefits is made retroactive to prior years. ____
6. Actuary's estimate of the PBO is increased.…
Question text
The computation of pension expense includes all the
following except
Select one:
13
a.
interest on plan assets
b.
all of these are included
C.
service cost component measured using current salary
levels.
d.
interest on defined benefit obligation.
Chapter 17 Solutions
INTERMEDIATE ACCOUNTING
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. 17.1ECh. 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. 17.14ECh. 17 - Prob. 17.17ECh. 17 - Prob. 17.23ECh. 17 - Prob. 17.32ECh. 17 - Prob. 17.33ECh. 17 - Prob. 17.1DMPCh. 17 - Prob. 17.2DMPCh. 17 - Prob. 17.3DMPCh. 17 - Prob. 17.5DMPCh. 17 - Prob. 17.6DMPCh. 17 - Prob. 17.8DMPCh. 17 - Prob. 17.9DMPCh. 17 - Prob. 17.11DMPCh. 17 - Prob. 1CCTCCh. 17 - Prob. 2CCTC
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Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Question 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_forwardInterest cost included in pension expense recognized for a period by an employer sponsoring a defined benefit pension plan represents the shortage between the expected and actual returns on plan assets. increase in the projected benefit obligation due to the passage of time increase in the fair value of plan assets due to the passage of time. amortization of the discount on accumulated OCI (PSC) 0arrow_forwardQuestion 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 Barrow_forward
- 1 a. Briefly describe how are pension gains and losses recognized. b. Explain what are pension gains and losses and why they are not recognized in net income in the period in which they arise.arrow_forwardSFAS No. 87, “Employers’ Accounting for Pensions,” requires an understanding of certainterms. Discuss the following components of annual pension cost:i. Service costii. Interest costiii. Actual return on plan assetsiv. Amortization of unrecognized prior service costv. Amortization of the transition amountarrow_forwardHelp Save & Exit Submit Which of the following is a correct statement concerning the reporting of the pension plan on the face of the employer's balance sheet? Multiple Choice 22:26 Neither the PBO nor the plan assets is separately reported. Both the PBC and the plan assets are separately reported. Only the PBO is separately reported. Only the plan assets are separately reported. sraw Hill Show All no 15....pdf Question no....pages Question no....pages MacBook Air ... 桌据arrow_forward
- Amortizing prior service cost for pension plans will: Help Save & Exit Submi Multiple Choice Increase retained earnings and decrease accumulated other comprehensive income. Decrease retained earnings and decrease accumulated other comprehensive income. Increase retained earnings and increase accumulated other comprehensive income. Decrease retained earnings and increase accumulated other comprehensive income. 11 of 39 Next > S Prev Question no....pages Question no....pages -...pdf AncBook Airarrow_forwardQuestion 11 of 20 View Policies Current Attempt in Progress The computation of pension expense includes all the following except O service cost component measured using current salary levels. O expected/actual return on plan assets. O interest on projected benefit obligation. O amortization of prior service cost.arrow_forwardCHOOSE THE LETTER OF THE CORRECT ANSWER What is the employee benefit expense for the current year? a. 1,180,000b. 2,100,000c. 1,850,000d. 1,050,000 What is the remeasurement gain or loss on plan assets on Dec. 31? a. 670,000 gainb. 670,000 lossc. 650,000 gaind. 650,000 lossarrow_forward
- Which component of Kensington’s periodic pension cost would be shown in OCI ratherthan P&L?A . Service costB . Net interest (income) expenseC . Remeasurementsarrow_forwardQuestion 5 The calculation used by Social Security to calculate retirement benefits is meant to replace a(n) of preretirement income for low-income retirees than for high-income retirees equal percentage O larger percentage smaller percentage equal amountarrow_forwardQuestion 1 of 20 View Policies O $2.25mn O $850,000 O $1.4mn O $5.7mn $3.45mn $4.3mn $5.7mn What is the amount of the pension liability that should be shown on Kerr's December 31, 2005 balance sheet?arrow_forward
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