Flashcards in 13 D Wrong Answers Deck (14):
What is the journal entry when a pension is underfunded?
Other comprehensive income. Xxx
Accrued pension liability. Xxx
Where is other comprehensive income closed to?
Accumulated other comprehensive income
What is the journal entry to record a pension expense?
Pension expense. Xxx
Accrued liability. Xxx
What is the journal entry when a payment is made and the pension in overfunded?
Prepaid pension expense. Xxx
Pension expense. Xxx
Year end PBO calculation (that's not footnote disclosure)
+ service cost
+ interest cost
- benefits paid
= Year end PBO
End of year PBO calculation that's a footnote disclosure
Includes all components in calculation (unlike financial statement
Which of the following are required disclosures for defined benefit plans?
1 the weighted average discount rate
2 the estimates of future contributions for the next 5 years
Weighted average discount rate is required
The estimates of future contributions for the next 5 years is
The assumed discount rate should reflect rates which pension benefits could be...
2) what is this rate referred to as?
2) settlement rate
To determine the settlement rate (discount rate of pension benefits), it is appropriate to look at...
Rates implicit in current prices of annuity contracts that could be
Used to settle obligation under defined benefit plan
Is the discount rate used to calculate the projected benefit obligation determined by a) expected return on plan assets of b) actual return on plan assets?
Recognized pension liability calculation
Recognized pension liability = pension cost - pension contribution
Out of the 3 below, which of the following must be disclosed in defined benefit pension plans?
1 assumed discount rate
2 expected long term rate of return on all the employer's assets
3 rate of compensation increase
Assumed discount rate and rate of compensation increase
Must be included
In a defined benefit plan, rates for assumed discount rate of compensation increase and expected long term rate of return on plan assets. Should this be disclosed in the notes?
Yes should be disclosed