Question

Exercise 20-5 Vaughn Company has five employees participating in its defined benefit pension plan. Expected years...

Exercise 20-5

Vaughn Company has five employees participating in its defined benefit pension plan. Expected years of future service for these employees at the beginning of 2017 are as follows.

Employee

Future Years of Service
Jim 3
Paul 4
Nancy 5
Dave 6
Kathy 6


On January 1, 2017, the company amended its pension plan, increasing its projected benefit obligation by $84,240.

Compute the amount of prior service cost amortization for the years 2017 through 2022 using the years-of-service method, setting up appropriate schedules.

Year

Annual Amortization
2017 $
2018
2019
2020
2021
2022
Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1
Jim Paul Nancy Dave Kathy Total
2017 1 1 1 1 1 5
2018 1 1 1 1 1 5
2019 1 1 1 1 1 5
2020 1 1 1 1 4
2021 1 1 1 3
2022 1 1 2
Total 3 4 5 6 6 24
Cost per service year 3510 =84240/24
Year Annual Amortization
2017 17550 =3510*5
2018 17550 =3510*5
2019 17550 =3510*5
2020 14040 =3510*4
2021 10530 =3510*3
2022 7020 =3510*2
0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Bonita Company has five employees participating in its defined benefit pension plan. Expected years of future...
Bonita Company has five employees participating in its defined benefit pension plan. Expected years of future service for these employees at the beginning of 2017 are as follows. Employee Future Years of Service Jim 3 Paul 4 Nancy 5 Dave 6 Kathy 6 On January 1, 2017, the company amended its pension plan, increasing its projected benefit obligation by $87,840. Compute the amount of prior service cost amortization for the years 2017 through 2022 using the years-of-service method, setting up...
Exercise 20-05 Ivanhoe Company has five employees participating in its defined benefit pension plan. Expected years...
Exercise 20-05 Ivanhoe Company has five employees participating in its defined benefit pension plan. Expected years of future service for these employees at the beginning of 2020 are as follows. Employee Future Years of Service Jim 3 Paul 4 Nancy 5 Dave 6 Kathy 6 On January 1, 2020, the company amended its pension plan, increasing its projected benefit obligation by $84,960. Compute the amount of prior service cost amortization for the years 2020 through 2025 using the years-of-service method,...
Sage Company has five employees participating in its defined benefit pension plan. Expected years of future...
Sage Company has five employees participating in its defined benefit pension plan. Expected years of future service for these employees at the beginning of 2020 are as follows. Employee Future Years of Service Jim 3 Paul 4 Nancy 5 Dave 6 Kathy 6 On January 1, 2020, the company amended its pension plan, increasing its projected benefit obligation by $77,040. Compute the amount of prior service cost amortization for the years 2020 through 2025 using the years-of-service method, setting up...
Larkspur Company has five employees participating in its defined benefit pension plan. Expected years of future...
Larkspur Company has five employees participating in its defined benefit pension plan. Expected years of future service for these employees at the beginning of 2020 are as follows. Employee Future Years of Service Jim 3 Paul 4 Nancy 5 Dave 6 Kathy 6 On January 1, 2020, the company amended its pension plan, increasing its projected benefit obligation by $80,640. Compute the amount of prior service cost amortization for the years 2020 through 2025 using the years-of-service method, setting up...
The Unforgettable Fire Company has five employees participating in its defined benefit pension plan. Expected years...
The Unforgettable Fire Company has five employees participating in its defined benefit pension plan. Expected years of future service for these employees at the beginning of 2007 are as follows:                                                          Future             Employee                    Years of Service             Adam                                      3             Bono                                       4             Edge                                        5             Larry                                       6             Joshua                                     6 On January 1, 2007, the company amended its pension plan increasing its PBO by $60,000 due to additional credit awarded for past service. Required: Compute the amount...
Lerchman Corp sponsors a defined-benefit pension plan for its employees. The company's actuary has provided the...
Lerchman Corp sponsors a defined-benefit pension plan for its employees. The company's actuary has provided the following information for the year ended December 31, 2022: Projected benefit obligation                                                 $730,000 Fair value of plan assets                                                        860,000 Service cost                                                                              240,000 Interest on projected benefit obligation                                  24,000 Amortization of prior service cost                                            60,000 Expected and actual return on plan assets                           82,500 The plan paid benefits of $150,000. The market-related asset value equals the fair value of plan assets. No contributions have been made...
Brownie Company sponsors a defined benefit pension plan for its employees. On January1, 2020, the following...
Brownie Company sponsors a defined benefit pension plan for its employees. On January1, 2020, the following balances relate to this plan. Plan assets $786,000 Projected benefit obligation 897,000 Pension asset/liability 111,000 Cr. Accumulated OCI (PSC) 92,000 Dr. As a result of the operation of the plan during 2020, the following additional data are provided by the actuary. Service cost $91,000 Settlement rate, 6% Actual return on plan assets 49,000 Amortization of prior service cost 31,000 Expected return on plan assets...
Bonita Company sponsors a defined benefit pension plan for its employees. The following data relate to...
Bonita Company sponsors a defined benefit pension plan for its employees. The following data relate to the operation of the plan for the year 2020 in which no benefits were paid. 1. The actuarial present value of future benefits earned by employees for services rendered in 2020 amounted to $56,300. 2. The company’s funding policy requires a contribution to the pension trustee amounting to $136,404 for 2020. 3. As of January 1, 2020, the company had a projected benefit obligation...
Exercise 20-10 (Part Level Submission) Skysong Corp. sponsors a defined benefit pension plan for its employees....
Exercise 20-10 (Part Level Submission) Skysong Corp. sponsors a defined benefit pension plan for its employees. On January 1, 2020, the following balances relate to this plan. Plan assets $498,300 Projected benefit obligation 614,700 Pension asset/liability 116,400 Accumulated OCI (PSC) 96,900 Dr. As a result of the operation of the plan during 2020, the following additional data are provided by the actuary. Service cost $92,500 Settlement rate, 9% Actual return on plan assets 54,200 Amortization of prior service cost 18,100...
Stars Inc. has a noncontributory defined pension plan for its employees. During 2020, the company had...
Stars Inc. has a noncontributory defined pension plan for its employees. During 2020, the company had service cost of $108,000, an expected return on plan assets of $16,704, amortization of prior service cost of $3,600, amortization of net pension loss of $4,000, and benefits paid to employees of $72,000. The January 1, 2020, balance in its projected benefit obligation was $349,200. The discount rate is 10%. Required Calculate pension expense for 2020.
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT