Reference no: EM132445864
ACCT 311 Intermediate Accounting Assignment - University of Maryland Global Campus, USA
Question - The pension plan for General GAP, a U.S. company, ended Year 6 with a fair value of plan assets and projected benefit obligation of $930,000 and $850,000, respectively. The following information pertains to Year 7 for the plan:
Plan contributions: $110,000
Plan benefits paid: $95,000
Service cost: $275,000
Other Comprehensive Income Balances:
-Unrecognized prior service cost goes from $225,000 at the end of Year 6 to $210,000 at the end of Year 7 -Current prior service cost: $10,000
-Unrecognized pension gain goes from $85,000 at the end of Year 6 to $90,000 at the end of Year 7 -Current pension gain: $12,000
Discount Rate: 8%
Expected (and Actual) Return on Plan Assets: 9%
Tax Rate: 30%
To prepare each required journal entry:
Click on a cell in the Account Name column and select the appropriate account. An account may be used once or not at all for a journal entry.
Enter the corresponding debit or credit amount in the associated column.
All amounts will be automatically rounded to the nearest dollar.
Not all rows in the table might be needed to complete each journal entry.
Required -
1. Calculate Net Periodic Pension Cost.
2. Calculate the Fair Value of Plan Assets as of the end of Year 7.
3. Calculate the Projected Benefit Obligation as of the end of Year 7.
4. Calculate the Funded Status as of the end of Year 7.
5. Provide the journal entries for each of the following events:
a. Contribution to the pension plan
b. Current Year Net Gain
c. Current Year Prior Service Cost
d. Service Cost
e. Interest Cost
f. Return on Plan Assets
g. Amortization of Prior Service Cost
h. Amortization of Net Gain