The following information relates to the defined benefit pension plan for Stark Ltd. for 2020. The corporation
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Question:
The following information relates to the defined benefit pension plan for Stark Ltd. for 2020. The corporation uses ASPE.
Current service cost | $348,000 |
Contributions | 321,000 |
Actuarial loss | 10,000 |
Expected & actual return on plan assets | 8% |
Fair value of plan assets, Jan 1 | 225,000 |
Defined benefit obligation, Jan 1 | 367,000 |
Interest rate for obligation | 9% |
Required
- Calculate the pension expense to be reported for 2020.
- Prepare the journal entries to record pension expense and the employer's contributions for 2020.
- What is the pension expense if the company uses IFRS
- Explain briefly in your own words the difference between defined benefit and defined contribution plans from the employer perspective
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