In Fisk Company s negotiations with its employees union

on January #2600
In Fisk Company’s negotiations with its employees’ union on January 1, 2016, the company
agreed to an amendment that increased the employee benefits based on services rendered in
prior periods. This resulted in an $80,000 prior service cost that increased the projected benefit
obligation of the company. Due to financial constraints, Fisk decided not to hind the total
increase in its pension obligation at that time.Prior to 2016, it had been Fisk’s policy to fond
only some of its pension expense each year so that the fair value of the plan assets at the end
of the year was less than the year-end projected benefit obligation. As a result, Fisk reported an
accrued/prepaid pension cost liability of $40,000 on its December 31, 2015, balance sheet.Fisk
appropriately amortized the prior service cost over a 10-ycar service life as a component of
pension expense in 2016 and 2017. The resulting pension and other information for 2016 and
2017 are as follows:aFunded December 31bAt year-endRequired:1. Prepare all the journal
entries related to Fisk’s pension plan for 2016. 2. List the amounts of any accounts related to
Fisk’s pension plan to be reported on the company’s December 31, 2016, balance sheet.
Indicate in what sections they would be reported.3. Prepare all the journal entries related to
Fisk's pension plan for 2017.4. List the amounts of any accounts related to Fisk’s pension plan
to be reported on the company’s December 31, 2017, balance sheet. Indicate in what sections
they would be reported.View Solution:
In Fisk Company s negotiations with its employees union on January

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