Reference no: EM132931912

The following information are taken from the actuarial valuation report for an entity's defined benefit plan:

Fair Value of Plan Assets, Jan. 1 = 2,100,000

Present Value of defined benefit obligation, Jan. 1 = 2,400,000

Past Service Cost (Vesting period is 5 years) = 300,000

Current Service Cost = 600,000

Benefits paid to retirees during the year = 450,000

Net gain on settlement of plan during the year = 60,000

Actuarial gain during the period = 15,000

Return on plan assets during the period = 270,000

Discount rate based on high quality corporate bonds = 12%

Required:

Problem 1: Compute for define benefit cost. Determine the amounts recognized in profit or loss and in other comprehensive income, respectively.