Question 5. 5. (TCO C) On January 1, 2008, Kinder Co. has the following balances: Projected benefit obligation $2,100,000 Fair value of plan assets 1,800,000 The settlement rate is 10%. Other data related to the pension plan for 2014 are: Service cost $180,000 Amortization of unrecognized prior service costs 60,000 Contributions 300,000 Benefits paid 105,000 Actual return on plan assets 237,000 Amortization of unrecognized net gain 18,000 The balance of the projected benefit obligation at December 31, 2014 is (Points : 5)

$2,685,000 $2,385,000 $2,355,000 $2,337,000

Question 6. 6. (TCO C) Presented below is pension information related to Woods, Inc. for the year 2013. Service cost $135,000 Interest on projected benefit obligation $46,000 Interest on vested benefits $30,000 Amortization of prior service cost due to increase in benefits $14,000 Expected return on plan assets $21,000 The amount of pension expense to be reported for 2013 is (Points : 5)

$109,000 $153,000 $174,000 $123,000

Question 7. 7. (TCO D) With a capital lease, the cost of the asset to be recorded is equal to (Points : 5)

the present value of the fair value of asset or minimum lease payments, whichever is less. the lessors asset book carrying value. the present value of minimum lease payments. the present value of unguaranteed residual value and present value of minimum lease payments.

Question 8. 8. (TCO D) Current GAAP requires (Points : 5)

that leases are not capitalized. that all long-term leases should be capitalized. that all leases are capitalized. that installment sale-type leases are capitalized.