Cahal-Michael Company has a postretirement health care benefit plan. On January 1, 2021, the following planrelated data

Question:

Cahal-Michael Company has a postretirement health care benefit plan. On January 1, 2021, the following planrelated data were available:

...............................................................................................................................($ in thousands)
Net loss—AOCI ...........................................................................................................$ 336
Accumulated postretirement benefit obligation ...................................................2,800
Fair value of plan assets ...............................................................................................500
Average remaining service period to retirement 14 years (same in previous 10 years)

The rate of return on plan assets during 2021 was 10%, although it was expected to be 9%. The actuary revised assumptions regarding the APBO at the end of the year, resulting in a $39,000 increase in the estimate of that obligation.


Required:
1. Calculate any amortization of the net loss that should be included as a component of postretirement benefit expense for 2021.
2. Assume the postretirement benefit expense for 2021, not including the amortization of the net loss component, is $212,000. What is the expense for the year?
3. Determine the net loss or gain as of December 31, 2021.

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question

Intermediate Accounting

ISBN: 978-1260481952

10th edition

Authors: J. David Spiceland, James Sepe, Mark Nelson, Wayne Thomas

Question Posted: