Question
Herring Wholesale Company has a defined benefit pension plan. On January 1, 2018, the following pension related data were available: ($ in 000s) Net gainAOCI
Herring Wholesale Company has a defined benefit pension plan. On January 1, 2018, the following pension related data were available:
($ in 000s) | ||
Net gainAOCI | $349 | |
Accumulated benefit obligation | 3,070 | |
Projected benefit obligation | 3,100 | |
Fair value of plan assets | 2,600 | |
Average remaining service period of active employees (expected to remain constant for the next several years) | 13 | years |
The rate of return on plan assets during 2018 was 9%, although it was expected to be 10%. The actuary revised assumptions regarding the PBO at the end of the year, resulting in a $42,000 decrease in the estimate of that obligation. Required:
1. Calculate any amortization of the net gain that should be included as a component of net pension expense for 2018. 2. Assume the net pension expense for 2018, not including the amortization of the net gain component, is $344,000. What is pension expense for the year? 3. Determine the net lossAOCI or net gainAOCI as of January 1, 2019.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started