13. On lanuary 1, 2015, Newlin Co has the llowing balances Projected bencfit obl

Question

13. On lanuary 1, 2015, Newlin Co has the llowing balances Projected bencfit oblipation Fair value of plan assets $2.100,000 ?0,000 The sentemens sate is 10on ther dste velated to the pension plan for 2015 Service cost Amortization of pior sevice costs due so increase in benei 35,000 Benclits pid Actsal returm on plan asets The fsir value of plans ascts at Decemsber 31, 2015 is 32.202,000. 34. Instrment Corporation has the Follewing debt investments which were held throughout 2014 2013 1231/14 12/3115 $800,000 $760,000 Trading 600,000 720,000 What amount would be reported as accumulated other comprehensive income related to deb investments in Instrument Corporation's balance sheet at December 31. 2014 a $80,000 gain. b $120,000 gain. c. $40,000 gain. d. $240,000 gain. 15. Metcalf Company leases a machine from Vollmer Corp, under an agreement which meets tk to be a finance lease for Metcalf. The six-year lease requires payment of $170,000 at the of each year, including $25,000 per year for maintenance, insurance, and taxes. The borrowing rate for the lessee is 10%; the lessor's implicit rate is 8% and is known by the present value ofan annuity due of 1 for six years at 10% is 4.79079. The present value o due of 1 for six years at 8% is 4.99271. Metcalf should record the leased asset at a. $848,761. b. $814.435 $723,943. $694,665.

Explanation / Answer

13 Fair Value of plan assets, Jan 1, 2015          1,800,000 Add: Contributions              300,000 Add: Actual return on plan assets              237,000 Less: Benefits Paid           (135,000) Fair Value of plan assets, Dec 31, 2015          2,202,000 Ans C 14 Cost Fair Value-12/31/14 Gain Trading $         600,000 $                      800,000 Available-for-sale              600,000                          640,000 $      1,200,000 $                  1,440,000 $                   240,000 Ans D (1440000-1200000) 15 Ans C $723,943 Explanation Lease Payment including maintenance etc. $170,000 Less: Maintenance , insurance and taxes                25,000 Lease Payment(Net)              145,000 x PVAD $1, 8%, 6years 4.99271 Leased Assets $         723,943 Ans C

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