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04-18-12 Class26 Ch 20 Pensions

Companies generally design pension plans that are

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Unformatted text preview: res for valuing the pension obligation. 4. List the components of pension expense. Chapter 18-21 Homework Examples review . 1. Companies generally design pension plans that are: noncontributory. noncontributory. insured. insured. qualified. qualified. contributory. contributory. Chapter 18-22 Homework Examples review . 1. Companies generally design pension plans that are: noncontributory. noncontributory. insured. insured. Qualified: tax benefits Qualified: contributory. contributory. Chapter 18-23 Homework Examples review . At December 31, 2012, Besler Corporation had a projected benefit obligation of $560,000, plan assets of $322,000, and prior service cost of $127,000 in accumulated other comprehensive income. Determine the pension asset/liability at December 31, 2012 Chapter 18-24 Homework Examples review . At December 31, 2012, Besler Corporation had a projected benefit obligation of $560,000, plan assets of $322,000, and prior service cost of $127,000 in accumulated other comprehensive income. Determine the pension asset/liability at December 31, 2012 Plan assets at fair value Project benefit obligation Pension asset/Liability Chapter 18-25 $322,000 (560,000) $(238,000) Homework Examples review Shin Corporation had a projected benefit obligation of $3,100,000 and plan assets of $3,300,000 at Shin January 1, 2012. Shin also had a net actuarial loss of $465,000 in accumulated OCI ( Other Comprehensive Income) at January 1, 2012. The average remaining service period of Shin's employees is 7.5 years. Compute Shin's minimum amortization of pension loss employees Answer: The concept here is one of “smoothing” the impact of dips in the actuarial losses Instead of taking the $465,000 loss immediately, and instead of taking the $465,000 loss over the Instead remaining service life of employees, the rules indicate that a computation is based upon definition of a “Corridor” amount as follows: The greater of: 10% of the Projected benefit obligation ($3,100,000 ) 10% or 10% of Plan assets of ($3,300,000 ) Net loss in accumulated other comprehensive income Corridor ($3,300,000 × 10%) Excess Average remaining life Minimum amortization Chapter 18-26 $465,000 33...
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