Question 25 Carla Company sponsors a defined benefit pension plan for its employees. The following data relate to the operation of the plan for the year 2017. 1. The actuarial present value of future benefits earned by employees for services rendered in 2017 amounted to $82,000. 2. The company’s funding policy requires a contribution to the pension trustee amounting to $151,000 for 2017. 3. As of January 1, 2017, the company had a projected benefit obligation of $1,603,000 and a debit balance of $429,000 in accumulated OCI (PSC). The fair value of pension plan assets amounted to $1,373,000 at the beginning of the year. The actual and expected return on plan assets was $63,000. The settlement rate was 5%. No gains or losses occurred in 2017 and no benefits were paid. 4. Amortization of prior service cost was $85,800 in 2017. Amortization of net gain or loss was not required in 2017. (c) Indicate the amounts that would be reported on the income statement and the balance sheet for the year 2017. Income Statement enter an account title $enter a dollar amount Balance Sheet select a section name enter an account title $enter a dollar amount

Corporate Financial Accounting

14th Edition

ISBN:9781305653535

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter10: Liabilities: Current, Installment Notes, And Contingencies

Section: Chapter Questions

Problem 10.5BE

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Question 25

Carla Company sponsors a defined benefit pension plan for its employees. The following data relate to the operation of the plan for the year 2017.

1.		The actuarial present value of future benefits earned by employees for services rendered in 2017 amounted to $82,000.
2.		The company’s funding policy requires a contribution to the pension trustee amounting to $151,000 for 2017.
3.		As of January 1, 2017, the company had a projected benefit obligation of $1,603,000 and a debit balance of $429,000 in accumulated OCI (PSC). The fair value of pension plan assets amounted to $1,373,000 at the beginning of the year. The actual and expected return on plan assets was $63,000. The settlement rate was 5%. No gains or losses occurred in 2017 and no benefits were paid.
4.		Amortization of prior service cost was $85,800 in 2017. Amortization of net gain or loss was not required in 2017.

(c)

Indicate the amounts that would be reported on the income statement and the balance sheet for the year 2017.

Income Statement
enter an account title		$enter a dollar amount

Balance Sheet
select a section name
enter an account title		$enter a dollar amount

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