Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN: 9781337788281
Author: James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher: Cengage Learning
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Chapter 19, Problem 11E
To determine
Compute the amount of net gain or loss to be included in the 2019 pension expense of company L and indicate whether the computed amount is added or subtracted from pension expense.
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Jennifer Corp.'s defined benefit pension plan had an amendment as of January 1, 2019, that retroactively included benefits of $1,500,000. The remaining service life of the employees impacted by this change is 10 years. Jennifer uses the straight-line method to amortize the prior service cost.
As of January 1, 2019, Jennifer had the following information related to its pension plan, including adjustments for the plan amendment:
Accrued/prepaid pension cost (credit)
$3,790,000
Projected benefit obligation
5,200,000
Accumulated other comprehensive income (debit)
1,500,000
Fair value of plan assets
1,410,000
Interest (discount) rate
10%
Expected rate of return on plan assets
12%
The actuary reported service cost of $600,000 in both 2019 and 2020. Annual payments to retirees totaled $90,000. The trustee of the plan assets reported the actual rate of return to be 11% in 2019.
Jennifer's annual year-end contribution to the plan equals the current year's service cost less…
Jennifer Corp.'s defined benefit pension plan had an amendment as of January 1, 2019, that retroactively included benefits of $1,500,000. The remaining service life of the employees impacted by this change is 10 years. Jennifer uses the straight-line method to amortize the prior service cost.
As of January 1, 2019, Jennifer had the following information related to its pension plan, including adjustments for the plan amendment:
Accrued/prepaid pension cost (credit)
$3,790,000
Projected benefit obligation
5,200,000
Accumulated other comprehensive income (debit)
1,500,000
Fair value of plan assets
1,410,000
Interest (discount) rate
10%
Expected rate of return on plan assets
12%
The actuary reported service cost of $600,000 in both 2019 and 2020. Annual payments to retirees totaled $90,000. The trustee of the plan assets reported the actual rate of return to be 11% in 2019.
Jennifer's annual year-end contribution to the plan equals the current year's service cost less…
Company G offers a defined benefit pension plan to its employees. At December 31, 2018, the present value of the
defined benefit obligation of the pension plan was $7,800,000 and the fair value of the plan assets was $8,000,000.
Information pertaining to the pension plan in 2019 follows:
The actuary advised that current service cost was $900,000.
The discount rate used in actuarial assumptions was 5%.
On June 1, 2019, Company G retroactively improved the benefits under the plan to January 1, 2019. The
cost of this improvement was determined by the plan actuary to be $975,000.
Benefits paid to retirees on July 1, 2019 were $750,000.
Company G contributed $675,000 to the pension plan on March 1, 2019.
The present value of the defined benefit obligation at December 31, 2019, was $8,125,000.
The fair market value of plan assets as at December 31, 2019, was $8,375,000.
• Company G has a December 31 year end.
Required:
• Prepare the worksheet and journal entries for 2019 using IFRS.
•…
Chapter 19 Solutions
Intermediate Accounting: Reporting And Analysis
Ch. 19 - Prob. 1GICh. 19 - Prob. 2GICh. 19 - Prob. 3GICh. 19 - Prob. 4GICh. 19 - Prob. 5GICh. 19 - Prob. 6GICh. 19 - Prob. 7GICh. 19 - Prob. 8GICh. 19 - Prob. 9GICh. 19 - Prob. 10GI
Ch. 19 - Prob. 11GICh. 19 - Prob. 12GICh. 19 - Prob. 13GICh. 19 - Prob. 14GICh. 19 - Prob. 15GICh. 19 - Prob. 16GICh. 19 - Prob. 17GICh. 19 - Prob. 18GICh. 19 - Prob. 19GICh. 19 - Prob. 20GICh. 19 - Prob. 21GICh. 19 - Prob. 22GICh. 19 - Prob. 23GICh. 19 - The actuarial present value of all the benefits...Ch. 19 - Prob. 2MCCh. 19 - Prob. 3MCCh. 19 - Prob. 4MCCh. 19 - Prob. 5MCCh. 19 - Prob. 6MCCh. 19 - Which of the following is not a component of...Ch. 19 - Prob. 8MCCh. 19 - Prob. 9MCCh. 19 - Prob. 10MCCh. 19 - Prob. 1RECh. 19 - Prob. 2RECh. 19 - Pinecone Company has plan assets of 500,000 at the...Ch. 19 - Prob. 4RECh. 19 - Prob. 5RECh. 19 - Prob. 6RECh. 19 - Prob. 7RECh. 19 - Prob. 8RECh. 19 - Given the following information for Tyler Companys...Ch. 19 - At the beginning of Year 1, Cactus Company has...Ch. 19 - Prob. 11RECh. 19 - Prob. 1ECh. 19 - Prob. 2ECh. 19 - Prob. 3ECh. 19 - Prob. 4ECh. 19 - Prob. 5ECh. 19 - Prob. 6ECh. 19 - Prob. 7ECh. 19 - Prob. 8ECh. 19 - Prob. 9ECh. 19 - Prob. 10ECh. 19 - Prob. 11ECh. 19 - Prob. 12ECh. 19 - Prob. 13ECh. 19 - Refer to the information provided in E19-13....Ch. 19 - Prob. 15ECh. 19 - Prob. 16ECh. 19 - Prob. 1PCh. 19 - Prob. 2PCh. 19 - Prob. 3PCh. 19 - Prob. 4PCh. 19 - Prob. 5PCh. 19 - Prob. 6PCh. 19 - Prob. 7PCh. 19 - Prob. 8PCh. 19 - Prob. 9PCh. 19 - Prob. 10PCh. 19 - Prob. 11PCh. 19 - Prob. 12PCh. 19 - Prob. 1CCh. 19 - Prob. 2CCh. 19 - Prob. 3CCh. 19 - Prob. 4CCh. 19 - Prob. 5CCh. 19 - Prob. 6CCh. 19 - Prob. 7CCh. 19 - Prob. 9C
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