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Company A sponsors a defined benefit pension plan. Company A applies the corridor method for its pension gains and losses included in accumulated other comprehensive
Company A sponsors a defined benefit pension plan. Company A applies the corridor method for its pension gains and losses included in accumulated other comprehensive income (AOCI).
For each independent item described below, select from the option lists provided the appropriate effect, if any, on the balance of Company A's plan assets, projected benefit obligation (PBO), and retained earnings below. Each choice may be used once, more than once, or not at all. If an item has no effect, select "No effect."
Item | Plan assets | PBO | Retained earnings |
1. Initial recognition of a prior service cost | |||
2. Benefits paid to employees from the plan | |||
3. Expected return on plan assets | |||
4. Initial recognition of the positive excess of actual return on plan assets over the expected return on plan assets | |||
5. Contributions to the plan | |||
6. Amortization of prior service credit | |||
7. Recognition of current service cost |
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