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. Use this given information plus any additional given information to answer Questions 54-56. Treat each question as being independent of the others unless stated otherwise. You are advised not to use any information given in other questions unless stated otherwise. [54] The company determines its interest expenses and benefits on the balance existing at the beginning of the year. You are told that the company recorded $386,400 as the expected returns on Plan Assets for the year. $546,000 were recorded as current services costs during 2019. What would be the interest expense on the Defined Benefit Obligation for 2019? a. $497,000. b. $96,000. O c. $483,000. d. $200,000 O e. Cannot be determined with the given information. [55] Given the actual rate of return on Plan Assets to be 6.25% and the expected returns on Plan Assets amounting to $386,400, what would be the OCl impact from gain or loss on Plan Assets? a. $53,250 CR. b. $53,250 DR. O c. $41,400 CR. O d. $41,400 DR. e. Cannot be determined with the given information. [56] Each year, the company makes a contribution to the plan at the end of the year. For 2019, this contribution amounted to 30% of the deficit in funding reported at the end of 2018. The entry reflected in the employer's books of accounts should show a. DEBIT-Accrued Pension Asset/Liability [$414,000); CREDIT-Cash [$414,000). O b. DEBIT-Accrued Pension Asset/Liability [$474,000); CREDIT-Cash [$474,000). OC. DEBIT-Pension Expenses ($414,000); CREDIT-Cash [$414,000). O d. DEBIT-Pension Expenses [$474,000); CREDIT-Cash [$474,000). e. DEBIT-Contribution Surplus [$414,000); CREDIT-Cash [$414,000). [57] On December 31, 2019, Tyree Corporation received the DBO report from the actuary. The following information was included in the report: ending DBO, $1,100,000; benefits paid to retirees, $100,000; interest cost accrued on the beginning DBO, $80,000. The discount rate applied by the actuary was 8%. There was no actuarial revaluation required nor any past service cost. What was the service cost for the year? a. $20,000. O b. $920,000 O c. $180,000. d. $120,000 e. None of the above. [58] The balance in the Defined Benefit Obligation on December 31, 2019 of a pension plan was revised to $7,800,000 upon an actuarial review. Prior to that, the computed amount was determined to be $7,920,000 also on December 31, 2019. How should the company record this change on the pension worksheet? a. DEBIT-Defined Benefits Obligation, [$120,000] ; CREDIT-Obligation Other Comprehensive Income, [$120,000) O b. DEBIT-Defined Benefits Obligation, ($120,000); CREDIT-Pension Fund Expenses , ($120,000). C. DEBIT-Pension Fund Expenses, [$120,000); CREDIT-Defined Benefits Obligation , ($120,000). O d. The company contributes a cash amount of $120,000 to the Pension Fund. Oe. The company receives a cash amount of $120,000 from the Pension Fund as a reimbursement for the loss suffered. [59] A pension plan paid out benefits amounting to $343,200 during the year to retired plan members. The entry reflected in a pension fund work sheet should show a. DEBIT-Plan Assets ; CREDIT-Plan Cash. O b. DEBIT-Plan Expenses; CREDIT-Cash. O c. DEBIT-Plan Expenses; CREDIT-Plan Assets. O d. DEBIT-Defined Benefit Obligation; CREDIT-Cash. e. None of the above. USE THE INFORMATION GIVEN BELOW TO ANSWER QUESTIONS 60-61. Scallion Company received the following reports on its defined benefit pension plan for the current calendar year 2019: DBO PLAN ASSETS $250,000 30,000 110,000 Balance Jan 1 $400,000 Balance Jan 1 Service Cost 195,000 Actual return Interest cost 40,000 Annual contribution Benefits paid (80,000) Benefits paid Balance Dec 31 $ 555,000 Balance, Dec 31 The long-term expected rate of return on plan assets is 10%. (80,000) 310,000 [60] Assuming no other data are relevant, what is the pension expense per IFRS for the year? a. $197,000. O b. $227,000 O c. $172,000. O d. $210,000. e. $217,000. [61] Determine the balance reported by Scallion on its balance sheet as at December 31, 2019 for the Net Benefits Asset/Liability account. a. $150,000. O b. $242,000 O c. $157,000. Od $232,000. e. $245,000. [62] The Pension Expense in a pension plan for the year were recorded at $856,800. In addition, an amount of $161,400 had been debited to the Other Comprehensive Income account to record all actuarial losses for the year. In addition, the company had contributed a cash amount of $350,000 to the Plan Assets. What would have been the amount recorded as Pension expenses for 2019 if the company were reporting under ASPE? a. $$856,800. O b. $$757,200. c. $161,400. d. $350,000. e. None of the above