Reference no: EM133015038
Problem 1 - EMPLOYEE BENEFITS - The accountant of Dee Corp. provided you the following information for the year ended December 31, 2014:
Fair value of plan asset, January 1 - P8,500,000
Present value of benefit obligation, January 1 - 7,500,000
Asset ceiling, January - 1 400,000
Current service cost - 1,400,000
Past service cost during the year - 200,000
Unrecognized past service cost - 300,000
Actual return on plan asset - 840,000
Contribution to the plan - 1,200,000
Benefits paid to retirees at scheduled retirement - 1,500,000
Unrecognized actuarial loss - 200,000
Decrease in the present value of benefit obligation due to changes in actuarial assumptions 200,000
Present value of additional defined benefit, obligations settled 500,000
Settlement price of the additional defined benefit obligation 400,000
Asset ceiling, December 31 200,000
Discount rate 10%
REQUIREMENTS -
1. What is the employee benefit cost to be recoognized in P/L?
2. What is the employee benefit cost to be recognized in OCI?
3. What is the present value of the projected benefit obligation as of December 31?
4. What is the fair value of the plan assets as of December 31?
Problem 2 - Brad Company provided the following information for the current year:
Current service cost 520,000
Actual return on plan assets 810,000
Interest expense on PBO 590,000
Interest income on plan assets 350,000
Loss on plan settlement 240,000
Past service cost during the year 360,000
Contribution to the plan 1,500,000
Required -
1. What is the employee benefit expense for the current year?
2. What is the remeasurement gain or loss?
3. What is the total defined benefit cost?
4. What is the prepaid or accrued benefit cost for the year?