Becker_Review_Problems_Week_3 - Ch20

Becker_Review_Problems_Week_3 - Ch20 - BECKER REVIEW...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
BECKER REVIEW PROBLEMS Week Three NEW CPA QUESTION The following is taken from the Becker CPA Review with permission: The following information pertains to Maple Co’s defined benefit pension plan for 2004: Fair value of plan assets, beginning of year $350,000 Fair value of plan assets, end of year 525,000 Employer contributions 110,000 Benefits paid 85,000 In computing pension expense, what amount should Maple use as actual return on plan assets? a. $ 65,000 b. $ 150,000 c. $ 175,000 d. $ 260,000 Remember to show calculations! Taken from Becker CPA Review with permission -- company name and dates changed F6/65-CPA-00690 Solution: Choice “b” is correct (SFAS 87 para 23): 350+110+x-85 = 525 X + 375 =525 X = 150 Beginning plan assets$350,000 + Contributions 110,000 + Actual return 150,000 - Benefits paid ( 85,000) Ending Plan Assets $525,000 Others incorrect. Year end plan assets equal beginning plan assets plus contributions less distributions plus actual return on plan assets
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 11/11/2010 for the course AC AC557 taught by Professor Ellis during the Summer '10 term at DeVry Long Beach.

Page1 / 2

Becker_Review_Problems_Week_3 - Ch20 - BECKER REVIEW...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online