Klondike Company sponsors a defined benefit pension plan for its employees. The following data relate to the operation of the plan for the years 2019 and 2020. 2019 2020 Projected benefit obligation, January 1 Plan assets (fair value and market-related value), January 1 Pension asset/liability, January 1 Prior service cost, January 1 S600,000 410,000 190,000 Cr. 160,000 Service cost 40,000 $ 59,000 Settlement rate 10% 10% Expected rate of return Actual return on plan assets Amortization of prior service cost 10% 10% 36,000 61,000 70,000 50,000 Annual contributions 97,000 81,000 Benefits paid retirees Increase in projected benefit obligation due to changes in actuarial assumptions Accumulated benefit obligation at December 31 Average service life of all employees Vested benefit obligation at December 31 31,500 54,000 87,000 -0- 721,800 789,000 20 years 464,000 Instructions (a) For both years 2019 and 2020, compute the annual pension expense.
Klondike Company sponsors a defined benefit pension plan for its employees. The following data relate to the operation of the plan for the years 2019 and 2020. 2019 2020 Projected benefit obligation, January 1 Plan assets (fair value and market-related value), January 1 Pension asset/liability, January 1 Prior service cost, January 1 S600,000 410,000 190,000 Cr. 160,000 Service cost 40,000 $ 59,000 Settlement rate 10% 10% Expected rate of return Actual return on plan assets Amortization of prior service cost 10% 10% 36,000 61,000 70,000 50,000 Annual contributions 97,000 81,000 Benefits paid retirees Increase in projected benefit obligation due to changes in actuarial assumptions Accumulated benefit obligation at December 31 Average service life of all employees Vested benefit obligation at December 31 31,500 54,000 87,000 -0- 721,800 789,000 20 years 464,000 Instructions (a) For both years 2019 and 2020, compute the annual pension expense.
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 6E
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