Chapter 20 Additional Practice 1. Gusty Co. has sponsored a defined benefit pension plan on behalf of its employees for over 10 years. At 12/31/09, the plan had a projected benefit obligation (PBO) of $5,890,000 and plan assets with a fair value of $6,240,000. At 12/31/09, Gusty’s adjusted general ledger reflected certain plan-related balances including unamortized gains of $645,000 and unamortized prior service costs of $128,000. The average remaining service life for all amortization is 20 years. During 2010, the actual plan investment returns were $110,000 higher than the expected return. In addition, the actuary revised his mortality assumptions used in the calculation of the PBO which resulted in a $90,000 increase in the PBO in late 2010. What is the total of all amortization to be included in pension expense for fiscal year 2010? Be sure to specify both the dollar amount and whether it is an increase or decrease to pension expense. 2.
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This note was uploaded on 12/14/2011 for the course AC 100 taught by Professor Strickland during the Spring '11 term at Alabama.