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Hi-Flie-Ing Corporation offers a defined benefit pension plan to all its eligible employees. The company uses the December 31 year end and uses IFRS to

Hi-Flie-Ing Corporation offers a defined benefit pension plan to all its eligible employees. The company uses the December 31 year end and uses IFRS to prepare its financial statements. It has reported a credit balance of $1,380,000 as at December 31, 2018 for its Net Defined Benefit Liability/Asset Account. The plan is underfunded by 20% of its Defined Benefit Obligation. The company also recorded, during 2019, $200,000 as Past Service Costs which were assumed to have accrued on January 1, 2019.


The balance in the Defined Benefit Obligation on December 31, 2019 of a pension plan was revised to $7,920,000 upon an actuarial review. Prior to that, the computed amount was determined to be $7,800,000 also on December 31, 2019. How should the company record this change on the pension worksheet?

a. DEBIT-Other Comprehensive Income, [$120,000] ; CREDIT-Defined Benefits Obligation, [$120,000].

b. DEBIT-Pension Fund Expenses, [$120,000]; CREDIT-Defined Benefits Obligation, [$120,000].

c. DEBIT-Defined Benefits Obligation, [$120,000]; CREDIT-Pension Fund Expenses, [$120,000].

d. The company contributes a cash amount of $120,000 to the Pension Fund.

e. The company receives a cash amount of $120,000 from the Pension Fund as a reimbursement for the loss suffered.

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