Sheehan bank corp, has a defined pension plan that covers all its full time employees. The chief
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Question:
Sheehan bank corp, has a defined pension plan that covers all its full time employees. The chief accountant obtained the following data relating to the pension plan in 2014,
- Calculate all the elements of pension expense for 2014 and make journal entries at the end of the year.
- Calculate the defined benefit obligation and fair value of plan assets at the end of 2014
Defined benefit obligation,Dec 31,2013 | $424,000 |
Benefits paid to retirees in 2014 | 28,000 |
Current service cost for 2014 | 26,800 |
Actual return on plan assets for 2014 | 19,800 |
Fair value of plan assets, dec 31,2013 | 312,000 |
Contributions to the pension fund at year end 2014 | 14,800 |
Actuarial revaluation made at the end of 2014, that the increased pension liability because of a revision upward of salary increase rates for employees | 19,200 |
Long term interest rate on high quality corporate bonds | 6% |
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