Exercise 20-8 Kenseth Corp. has the following beginning-of-the-year present valu

Question

Exercise 20-8

Kenseth Corp. has the following beginning-of-the-year present values for its projected benefit obligation and market-related values for its pension plan assets.

Projected
Benefit
Obligation

Plan
Assets
Value

The average remaining service life per employee in 2013 and 2014 is 10 years and in 2015 and 2016 is 12 years. The net gain or loss that occurred during each year is as follows: 2013, $550,760 loss; 2014, $177,030 loss; 2015, $21,637 loss; and 2016, $49,175 gain.

Using the corridor approach, compute the amount of net gain or loss amortized and charged to pension expense in each of the four years, setting up an appropriate schedule.

Year

Minimum Amortization of Loss

Projected
Benefit
Obligation

Plan
Assets
Value

2013 $3,934,000 $3,737,300 2014 4,720,800 4,917,500 2015 5,802,650 5,114,200 2016 7,081,200 5,901,000

Explanation / Answer

1967   (f)

b)(550760 - 491750) /10 = 59010 /10 = $ 5901

c= 550760-5901+177030 = 721889

d) =(721889 - 580265) /12 = 11802

e) 721889-11802+21637 = 731724

f) (731724 - 708120 ) / 12 = 1967

year Projected benefit obligation plan asset 10% corridor (10% of[Higher of projected benefit or obligation] Accumulated OCI(Gain/loss) minimum amortization of .loss 2013 3934000 3737300 393400 0   [as on Beginning ] 0 2014 4720800 4917500 491750 550760 5901 (b) 2015 5802650 5114200 580265 721889   (c) 11802 (d) 2016 7081200 5901000 708120 731724   (e)

1967   (f)

Related Questions

Navigate

• Browse (All)
• Browse E
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.