Montoya Company has available the following information about its defined-benefi
ID: 2483655 • Letter: M
Question
Montoya Company has available the following information about its defined-benefit pension plan for the year ending December 31, 2015:
Service cost for 2015 $ 25,000
Accumulated benefit obligation 683,000
Plan assets at fair value 630,000
Accumulated OCI (PSC) 300,000
Vested benefit obligation 505,000
Market-related asset value 725,000
Projected benefit obligation 845,000
Accumulated OCI net gain 90,000
Interest on projected benefit obligation 64,000
Instructions
Calculate the pension asset / liability to be recorded at December 31, 2015.
Calculate the 2016 amortization of the net gain. The average remaining service life of employees is 10 years.
Explanation / Answer
pension assets:
plan asset at fair value 630000
market asset value 725000
Total 1355000
pension liability
accumulated benefit obligation 630000
service cost 25000
vested benefit obligation 505000
interest on benefit obligation 64000
Total 1224000
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