Question
The table below outlines details relevant to Aikman Inc.'s defined benefit pension plan: PBO: Balance, Jan. 1 $ 248,000 Service cost 49,000 Interest cost (5%
The table below outlines details relevant to Aikman Inc.'s defined benefit pension plan:
| PBO: | ||||
| Balance, Jan. 1 | $ | 248,000 | ||
| Service cost | 49,000 | |||
| Interest cost (5% discount rate) | 12,400 | |||
| Gain from changes in actuarial assumptions in 2021 | (5,800 | ) | ||
| Benefits paid to retirees | (28,000 | ) | ||
| Balance, Dec. 31 | $ | 275,600 | ||
| Plan assets: | ||||
| Balance, Jan.1 | $ | 258,000 | ||
| Actual return (expected return was $23,300) | 20,000 | |||
| Contributions | 43,000 | |||
| Benefits paid | (28,000 | ) | ||
| Balance, Dec. 31 | $ | 293,000 | ||
| ABO, Dec. 31 | $ | 253,800 | ||
| January 1, 2021, balances: | ||||
| Prior service costAOCI (amortization $4,680/yr.) | 4,680 | |||
| Net gainAOCI (amortization, if any, over 15 years) | 46,800 | |||
Required: 1. Determine pension expense for 2021. 2. Prepare the 2021 journal entries to record pension expense and funding. 3. Prepare any journal entries to record any 2021 gains or losses.
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Analysing Financial Performance Using Integrated Ratio Analysis
Authors: Nic La Rosa
1st Edition
0367552523, 978-0367552527
