COMM 450 Study Guide - Final Guide: Pension, Operating Lease, Finance Lease
Document Summary
Preston chemical ltd. operates a defined benefit pension plan. The plan was retro-actively adjusted one year ago on january 1, 20x8 for those employees who had been a part of the previous plan. This resulted in a past service cost obligation of ,000. The expected period to full eligibility of this employee group at the time the plan was adjusted was 13 years. The actuary informed you that on january 1, 20x9 the market value of the pension assets is ,000 while the accrued benefit obligation is ,200,000. Also, as of january 1, 20x9, there is an unamortized actuarial loss of ,000. The actuary also informs you that the actual pension obligation on december 31, 20x9 is ,300,000. Market value of pension fund assets (12/31/20x9) $ 1,100,000. Deferred pension liability (b/s) at 12/31/20x8) $ 480,000 (dr) Note: all accruals and cash flows occur at mid-year. Actuarial gains or losses are amortized beginning in the year after they are identified/occur.
