Headland Company sponsors a defined benefit pension plan for its employees. The following data refers to the
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Question:
Headland Company sponsors a defined benefit pension plan for its employees. The following data refers to the operation of the plan for the years 2020 and 2021.
2020 | 2021 | |||||
Projected benefit obligation, January 1 | $ 604,400 | |||||
Plan assets (fair value and market-related value), January 1 | 413,300 | |||||
Pension asset/liability, January 1 | 191,100 | chrome | ||||
Previous service cost, January 1 | 159,200 | |||||
cost of service | 40.000 | $58,500 | ||||
settlement rate | 10 | % | 10 | % | ||
expected rate of return | 10 | % | 10 | % | ||
Actual return on plan assets | 36,000 | 61,600 | ||||
Amortization of the cost of the previous service | 69,300 | 50,000 | ||||
annual contributions | 96,700 | 81.400 | ||||
benefits paid retirees | 31,600 | 54,040 | ||||
Increase in projected benefit obligation due to changes in actuarial assumptions | 86,300 | 0 | ||||
Accrued benefit obligation as of December 31 | 722,000 | 792,600 | ||||
Average useful life of all employees. | 20 years | |||||
Obligation for benefits acquired as of December 31 | 465,900 | |||||
Required
1.Prepare a pension return that presents the years 2020 and 2021.
2. Prepare journal entries to reflect all pension plan transactions and events as of December 31 of each year.
3. For the year 2021, indicate the pension amounts reported in the financial statements.
Related Book For
Intermediate Accounting
ISBN: 978-1119503668
17th edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfiel
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