| Name: | Date: |
| Instructor: | Course: |
| Intermediate Accounting, 14th Edition by Kieso, Weygandt, and Warfield |
| P20-2 Allison Co. has the following postretirement benefit plan balances on January 1, 2012. |
| Accumulated Postreitrement benefit obligation | $2,535,000 |
| Fair value of plan assets | 2,535,000 |
| The interest (settlement) rate applicable to the plan is | 8% | On January 1, 2013, the company amends the plan |
| so that prior service costs of | $185,000 | were created. Other data related to the pension plan are as follows: |
| 2012 | 2013 |
| Service costs | $80,000 | $87,000 |
| Prior service costs amortization | 0 | 13,000 |
| Contributions (funding) to the plan | 47,000 | 38,000 |
| Benefits paid | 41,000 | 43,000 |
| Actual return on plan assets | 200,000 | 155,000 |
| Expected rate of return on assets | 9% | 7% |
| Instructions: |
| (a) Prepare a worksheet for the postreitrement plan for 2012 & 2013. |
| Allison Co. |
| Pension Worksheet—2012 and 2013 |
| General Journal Entries | Memo Record |
| Items | Annual
Expense | DR/CR | Cash | DR/CR | OCI - Prior Service Cost | DR/CR | OCI - Gain/Loss | DR/CR | Pension
Asset/
Liability | DR/CR | Accum Projected Benefit Obligation | DR/CR | Plan
Assets | DR/CR |
| Balance, Jan. 1, 2012 |
| Service cost |
|
| Interest cost |
| Actual return |
| Unexpected Loss |
| Contributions |
| Benefits |
| Journal entry, 12/31/12 |
| Accum OCI, 12/31/11 |
| Balance, Dec. 31, 2012 |
| Additional PSC 1/1/2013 |
| Balance, Jan 1, 2013 |
| Service cost |
| Interest cost |
| Actual return |
| Unexpected loss |
| Amortization of PSC |
| Contributions |
| Benefits |
| Journal entry, 12/31/13 |
| Accum OCI, 12/31/12 |
| Balance, Dec. 31, 2013 |
| Area for calculations as desired |
| Area for calculations as desired |
| Area for calculations as desired |
| (b) Prepare any journal entries related to the postretirement plan that would be needed at December 31, 2012. |
| (c) Prepare any journal entries related to the postretirement plan as of December 31, 2013. |
| (d) Show the postretirement-benefit–related amounts reported in the 2013 Income Statement and Balance Sheet. |
| Financial Statements -2013 |
| Income Statement |
| | 0 |
| Comprehensive Income Statement |
| Net Income | XXXXX |
| Other comprehensive income (loss) |
| | 0 |
| | 0 |
| | 0 | 0 |
| Comprehensive Income | XXXXX |
| Balance Sheet |
| Liabilities |
| | 0 |
| Stockholder's Equity |
| | 0 |
| | 0 |
adrner
acct557_w3_hw_templates.xlsx
