Exam 19: Accounting for Postretirement Benefits

The Peanut Company has a defined benefit pension plan for its employees. The following information pertains to the pension plan: The December 31, 2014 adjusting journal entries include a

Vested benefits are

If a pension plan amendment is adopted and retroactive benefits are granted to employees, the amount of the prior service cost at the date of grant is accounted for

If a company uses the indirect method to report cash flows, it

What are the three major differences between the accounting for pensions and Other Postretirement benefit's (OPRB's)?

The Donna Company adopted a defined benefit pension plan on January 1, 2014, and prior service credit was granted to employees. As of January 1, 2014, the prior service cost is $68,250. The unrecognized prior service cost is amortized by the straight-line method over the remaining 15-year service life of the company's active employees. Funding for the pension plan was $170,745 and $186,933 at December 31, 2014 and 2015, respectively. Required: Prepare the journal entries to record net periodic pension expense and the funding as of December 31, 2014 and 2015. Show computations and round answers to the nearest dollar.

What estimates are necessary to account for a defined benefit pension plan?

What five components comprise pension expense?

Current GAAP regarding employers' accounting for defined benefit pension plans defines an underfunded plan at the end of the period when the

Exhibit 19-01 Marley Co. has an underfunded prepaid/accrued pension cost of $2,000 (debit balance) at December 31, 2014. The following information pertains to 2015: -Refer to Exhibit 19-1. The balance in Prepaid/Accrued Pension Cost at December 31, 2015, should be

Accounting principles for defined benefit pension plans under IFRS differ from U.S. GAAP in all of the following areas except that under IFRS

Postemployment benefits are provided to former employees

Current GAAP requires that the net gain or loss from a settlement or curtailment be included in the

John Company adopted a defined benefit pension plan on January 1, 2014, and prior service credit was granted to employees. The present value of that prior service obligation as of January 1, 2014 was $1,400,000 and is being amortized by the straight-line method over the remaining 20-year service life of the company's active employees. Additional information relating to the company's pension plan for 2014 is presented below: What amount should be recorded in Prepaid/Accrued Pension Cost when recording the 2014 pension expense and funding at December 31, 2014?

Other postretirement benefits are provided to former employees after employment for retirement.

Which of the following is typically the most significant OPEB (other postemployment benefits)?

A list of terms (a-i) and a list of descriptive phrases (1-9) related to pension accounting are provided below: Required: Match each item to its descriptive phrase by placing the appropriate letter in the space provided.

According to GAAP pension expense for a defined benefit pension plan consists of five components. Required: List and briefly describe each of the five components of net periodic pension cost that a company must recognize.