Compute the amount of the other comprehensive income (G/L) as of December 31, 2012.

(Computation of Actual Return, Gains and Losses, Corridor Test, and Pension Expense) Erickson Company sponsors a defined benefit pension plan. The corporation’s actuary provides the following information about the plan.

January 1,
2012

December 31,
2012

Vested benefit obligation

$1,500

$1,900

Accumulated benefit obligation

1,900

2,730

Projected benefit obligation

2,500

3,300

Plan assets (fair value)

1,700

2,620

Settlement rate and expected rate of return

10%

Pension asset/liability

800

?

Service cost for the year 2012

400

Contributions (funding in 2012)

700

Benefits paid in 2012

200

Instructions

(a) Compute the actual return on the plan assets in 2012.

(b) Compute the amount of the other comprehensive income (G/L) as of December 31, 2012. (Assume the January 1, 2012, balance was zero.)

(c) Compute the amount of net gain or loss amortization for 2012 (corridor approach).

(d) Compute pension expense for 2012.

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