1) Watt Inc sponsors a defined benefit pension plan for its employees. On January 1, 2017, the...
Question:
1) Watt Inc sponsors a defined benefit pension plan for its employees. On January 1, 2017, the following balances ralate to this plan.
Plan Assets 4,316,000
Projected benefit olbigation 4,300,000
Prior Service Cost (OCI) 840,000
Accumulated OCI- Loss 656,000
As a result of the operations of the plan during 2017, the following additional data are provided by the actuary.
Service cost for 2017 523,000
Settlement & Expected return rate 10%
Actual return on plan assets 510,000
Average service life of all covered employees in years 12
PBO on Dec 31,2017, based on actuarial predictions 4,400,000
Contributions in 2017 652,000
Benefits paid retirees in 2017 705,000
a) Using the data above, compute pension expense for the year 2017 by preparing a pension worksheet
b) Compute the amount of net gains or losses to be amortized for 2017 and 2018
Intermediate Accounting
ISBN: 978-0470616314
IFRS edition volume 2
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield