Question
Kollar Company, a publicly traded corporation, has a defined benefit pension plan. Pension Information concerning this plan for the fiscal year 2017 is presented below:
Kollar Company, a publicly traded corporation, has a defined benefit pension plan. Pension Information concerning this plan for the fiscal year 2017 is presented below: Information provided by the plans actuary:
DBO as of December 31, 2016 $1,800,000
Past service reduction from plan amendment on January 2, 2017 300,000
Current service costs for 2017 520,000 Payments to retirees in 2017 400,000
Changes in actuarial assumptions at December 31, 2017 resulting in an actuarial loss 45,000
Discount rate used on DBO for 2017 6%
Information provided by the plans trustee:
Plan asset balance on January 1, 2017 $1,600,000
2017 contributions 540,000
2017 actual return on plan assets 180,000
Expected long-term rate of return on plan assets 6%
Required: Write neatly and show all your work.
(a) Prepare a continuity of all pension-related accounts for the year 2017, using either the worksheet format or the continuity format, at your preference. (b) Prepare the pension-related journal entry(ies) at December 31, 2017. (c) Identify the plans funded status. (d) How would this plan be shown on the December 31, 2017 Statement of Financial Position? (e) For this part, assume that Lumnar uses ASPE. Provide the note disclosure at December 31, 2017.
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