Question

Zeff Manufacturing provides the following information about its postretirement health care plan for 2014:
Accumulated postretirement benefit obligation on 1/1/14 . $300,000
Fair value of plan assets on 1/1/14 ........... 30,000
Benefits paid to retirees at 12/31/14 ........... 6,500
Service cost for 2014 ................ 20,000
Recognized prior service cost .............. 10,000
Recognized actuarial loss ................ 7,000
Actual return on plan assets .............. 4,500
Contributions to the plan at 12/31/14 ........... 12,000
Discount rate ...................... 8%
Expected long-run rate of return on plan assets ........ 10%

Required:
1. Determine Zeff’s postretirement health care expense in 2014.
2. Determine the fair value of plan assets at December 31, 2014.
3. Determine the APBO amount at December 31, 2014.



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  • CreatedSeptember 10, 2014
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