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Exam 17: Pensions and Other Postretirement Benefits

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Question 41

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What is different about the expected postretirement benefit obligation and the accumulated postretirement benefit obligation?

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The EPBO is the actuary's estimate of th...

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Question 42

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Eligibility requirements and the nature of benefits for postretirement health care plans usually are specified in the:

A) Written plan.
B) Informal plan.
C) Substantive plan.
D) Severance plan.

E) A) and C)
F) B) and C)

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Question 43

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With respect to Ralph, what is the service cost to be included in Oregon's 2013 postretirement benefit expense, rounded to the nearest dollar?

With respect to Ralph, what is the interest cost to be included in Oregon's 2014 postretirement benefit expense, rounded to the nearest dollar?

Accumulated other comprehensive income:

What was the net pension asset/liability reported in the balance sheet at the end of the year?

Wainright Co. began the year with a net pension liability of $112 million (underfunded pension plan). Pension expense for the year included the following ($ in millions): service cost, $40; interest cost, $24; expected return on assets, $16; amortization of net loss, $8; amortization of prior service cost, $12. Required: Prepare the appropriate general journal entry to record Wainright's pension expense.

What is the 2013 pension expense for Havana's plan?

Interest cost will:

At December 31, 2012, Mallory, Inc., reported in its balance sheet a net loss of $12 million related to its postretirement benefit plan. The actuary for Mallory at the end of 2013 increased her estimate of future health care costs. Mallory's entry to record the effect of this change will include:

With respect to Ralph, what is Oregon's accumulated postretirement benefit obligation (APBO) at the end of 2013, rounded to the nearest dollar?

Which of the following statements typifies defined contribution plans?

What was the prior service cost at the beginning of the year?

On January 1 of the current reporting year, Coda Company's projected benefit obligation was $30 million. During the year, pension benefits paid by the trustee were $4 million. Service cost was $10 million. Pension plan assets earned $5 million as expected. At the end of the year, there was no net gain or loss and no prior service cost. The actuary's discount rate was 10%. Required: Determine the amount of the projected benefit obligation at December 31.

Pension data for the Ben Franklin Company include the following for the current calendar year: Discount rate, 8% Expected return on plan assets, 10% Actual return on plan assets, 9% Service cost, $200,000 Required: 1) Determine pension expense for the year. 2) Prepare the journal entries to record pension expense and funding for the year.

Pension plans typically require some minimum period of employment before benefits vest. What is the 1974 federal law governing vesting (as well as other aspects of pensions)? What are the vesting rules?

What are the five components of postretirement benefit expense?

When the service method is used for amortizing prior service costs, the amount recognized each year is:

A net gain or loss affects the pension expense only if it exceeds an amount equal to what percentage of the PBO or plan assets, whichever is higher?

Data pertaining to the postretirement health care benefit plan of Amazing Delivery Service include the following for the current calendar year: Required: 1) Determine Amazing's postretirement benefit expense for the current year. 2) Prepare the journal entry to record the benefit expense for the current year.