Company G offers a defined benefit pension plan to its employees. At December 31, 2018, the present value of the defined benefit obligation of the pension plan was $7,800,000 and the fair value of the plan assets was $8,000,000. Information pertaining to the pension plan in 2019 follows: • The actuary advised that current service cost was $900,000. • The discount rate used in actuarial assumptions was 5%. • On June 1, 2019, Company G retroactively improved the benefits under the plan to January 1, 2019. The cost of this improvement was determined by the plan actuary to be $975,000. • Benefits paid to retirees on July 1, 2019 were $750,000. • Company G contributed $675,000 to the pension plan on March 1, 2019. • The present value of the defined benefit obligation at December 31, 2019, was $8,125,000.
Company G offers a defined benefit pension plan to its employees. At December 31, 2018, the present value of the defined benefit obligation of the pension plan was $7,800,000 and the fair value of the plan assets was $8,000,000. Information pertaining to the pension plan in 2019 follows: • The actuary advised that current service cost was $900,000. • The discount rate used in actuarial assumptions was 5%. • On June 1, 2019, Company G retroactively improved the benefits under the plan to January 1, 2019. The cost of this improvement was determined by the plan actuary to be $975,000. • Benefits paid to retirees on July 1, 2019 were $750,000. • Company G contributed $675,000 to the pension plan on March 1, 2019. • The present value of the defined benefit obligation at December 31, 2019, was $8,125,000.
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter19: Accounting For Post Retirement Benefits
Section: Chapter Questions
Problem 6RE
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![Company G offers a defined benefit pension plan to its employees. At December 31, 2018, the present value of the
defined benefit obligation of the pension plan was $7,800,000 and the fair value of the plan assets was $8,000,000.
Information pertaining to the pension plan in 2019 follows:
The actuary advised that current service cost was $900,000.
The discount rate used in actuarial assumptions was 5%.
On June 1, 2019, Company G retroactively improved the benefits under the plan to January 1, 2019. The
cost of this improvement was determined by the plan actuary to be $975,000.
Benefits paid to retirees on July 1, 2019 were $750,000.
Company G contributed $675,000 to the pension plan on March 1, 2019.
The present value of the defined benefit obligation at December 31, 2019, was $8,125,000.
The fair market value of plan assets as at December 31, 2019, was $8,375,000.
• Company G has a December 31 year end.
Required:
• Prepare the worksheet and journal entries for 2019 using IFRS.
• Prepare the worksheet and journal entries for 2019 using ASPE. For ASPE finance cost is calculated using
the weighted average method.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fd2c992b3-4ee3-4c1a-b1c2-3fed1129909a%2F37c0f6f0-077d-4504-9321-874ff3593e0b%2Fj4m43nr_processed.png&w=3840&q=75)
Transcribed Image Text:Company G offers a defined benefit pension plan to its employees. At December 31, 2018, the present value of the
defined benefit obligation of the pension plan was $7,800,000 and the fair value of the plan assets was $8,000,000.
Information pertaining to the pension plan in 2019 follows:
The actuary advised that current service cost was $900,000.
The discount rate used in actuarial assumptions was 5%.
On June 1, 2019, Company G retroactively improved the benefits under the plan to January 1, 2019. The
cost of this improvement was determined by the plan actuary to be $975,000.
Benefits paid to retirees on July 1, 2019 were $750,000.
Company G contributed $675,000 to the pension plan on March 1, 2019.
The present value of the defined benefit obligation at December 31, 2019, was $8,125,000.
The fair market value of plan assets as at December 31, 2019, was $8,375,000.
• Company G has a December 31 year end.
Required:
• Prepare the worksheet and journal entries for 2019 using IFRS.
• Prepare the worksheet and journal entries for 2019 using ASPE. For ASPE finance cost is calculated using
the weighted average method.
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