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    This document contains information about pension accounting for the years 2010 and 2011 for a company: 1) In 2010, the company recorded a pension expense of $129,000 and other comprehensive income of $92,000. Cash contributions to the plan were $70,000. 2) In 2011, the company recorded a pension expense of $134,223 and other comprehensive income of $60,673. Cash contributions were $50,000. 3) The balances in the pension plan as of the end of 2011 included a projected benefit obligation of $836,050, plan assets of $599,500, and a pension liability of $236,550.

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    This document contains information about pension accounting for the years 2010 and 2011 for a company: 1) In 2010, the company recorded a pension expense of $129,000 and other comprehensive income of $92,000. Cash contributions to the plan were $70,000. 2) In 2011, the company recorded a pension expense of $134,223 and other comprehensive income of $60,673. Cash contributions were $50,000. 3) The balances in the pension plan as of the end of 2011 included a projected benefit obligation of $836,050, plan assets of $599,500, and a pension liability of $236,550.

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    24 views4 pages

    Items: Ch. 20: Problem P20-8

    Uploaded by

    Justin Senseman
    This document contains information about pension accounting for the years 2010 and 2011 for a company: 1) In 2010, the company recorded a pension expense of $129,000 and other comprehensive income of $92,000. Cash contributions to the plan were $70,000. 2) In 2011, the company recorded a pension expense of $134,223 and other comprehensive income of $60,673. Cash contributions were $50,000. 3) The balances in the pension plan as of the end of 2011 included a projected benefit obligation of $836,050, plan assets of $599,500, and a pension liability of $236,550.

    Copyright:

    Attribution Non-Commercial (BY-NC)
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    of 4

    Ch.

    20: Problem P20-8

    P20-8
    A)
    Annual Pension Expense

    Cash

    Items
    Balance, Jan. 1, 2010
    Service cost
    Interest cost
    Actual return
    Unexpected loss
    Amortization of PSC
    Contributions
    Benefits
    Increase in PBO
    Journal entry for 2010
    Accumulated OCI, Dec. 31, 2009
    Balance, Dec. 31, 2010
    Service cost
    Interest cost
    Actual return
    Unexpected gain
    Amortization of PSC
    Amortization of Loss
    Contributions
    Benefits
    Journal entry for 2011

    40,000 Dr.
    60,000 Dr.
    36,000 Cr.
    5,000 Cr.
    70,000 Dr.

    OCI- Prior Serv


    Cost

    70,000 Cr.
    97,000 Cr.

    129,000 Dr.

    97,000 Cr.

    70,000 Cr.
    160,000 Dr.
    90,000 Dr.

    59,000 Dr.
    75,550 Dr.
    61,000 Cr.
    9,850 Dr.
    50,000 Dr.
    823 Dr.

    50,000 Cr.
    81,000 Cr.

    134,223 Dr.

    81,000 Cr.

    50,000 Cr.

    Accumulated OCI, Dec. 31, 2010

    90,000 Dr.

    Balance, Dec. 31, 2011

    40,000 Dr.

    B)

    Pension Expense
    Other Comprehensive Income (G/L)

    2010
    129,000
    92,000

    Cash
    Pension Asset/Liability
    Other Comprehensive Income (PSC)

    97,000
    54,000
    70,000

    2010
    7,450
    134,223

    Pension Asset/Liability
    Pension Expense
    Cash
    Other Comprehensive Income (PSC)
    Other Comprehensive Income (G/L)

    81,000
    50,000
    10,673

    B)

    2011
    Income Statement Pension Expense
    Comprehensive Income Statement
    Net Income
    Other comprehensive income (loss)
    Asset gain (loss)
    Amorization of loss
    Prior service cost amotization

    134,223
    ?
    50,000
    10,673

    9,850
    823
    50000

    60,673
    ????

    Balance Sheet
    Liabilities
    Pension Liabilty
    Stockholders Equity
    Accum. Other comprehensive loss (PSC)
    Accum. Other comprehensive loss (G/L)

    236550
    40000
    81327

    OCI
    GAIN/LOSS

    Pension
    asset/Liab
    190,000 Cr.

    Proj Benefit
    Obligation
    600,000 Cr.
    40,000 Cr.
    60,000 Cr.

    Plan Assets
    410,000 Dr.

    36,000 Dr.
    5,000 Dr.

    31,500 Dr.
    87,000 Cr.

    87,000 Dr.
    92,000 Dr.

    54,000 Cr.

    0
    92,000 Dr.

    244,000 Cr.

    755,500 Cr.
    59,000 Cr.
    75,550 Cr.

    97,000 Dr.
    31,500 Cr.

    511,500 Dr.

    61,000 Dr.
    9,850 Cr.
    823 Cr.

    10,673 Cr.

    54,000 Dr.

    81,000 Dr.
    54,000 Cr.

    836,050 Cr.

    599,500 Dr.

    7,450 Dr.

    92,000 Dr.
    81,327 Dr.

    236,550 Cr.

    1)

    2)

    Ch. 22: Problem P22-3

    Retained Earnings
    SALES COMMISSIONS PAYABLE
    SALES COMMISSIONS EXPENSE

    Cost of goods Sold


    Retained Earnings
    Inventory

    3,500
    2,500
    1,000

    25,700
    19,000
    6,700

    Income Overstated (Understated)


    2008

    Beg Inventory
    Ending Inventory

    3)

    4)

    2009
    16,000
    -16,000
    -19,000
    $ (16,000.00) $ (3,000.00) $

    ACCUM. DEPRECIATION- EQUIP.


    DEPRECIATION EXP.

    Construction in process
    Deffered Tax Liability
    Retained earnings

    2010
    19,000
    6,700
    25,700.00

    4,800
    4,800

    45,000
    18,000
    27,000

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