Whispering 

Corporation is a privately owned company that uses ASPE. On January 1, 2020 Whispering’s financial records indic

Defined Benefit Obligation $1,350,000

Pension Plan Assets 1,500,000

Whispering Corporation’s actuary provided the following information on December 31, 2020:

Current year service cost $80,000

Prior service cost, granted Jan 1, 2020 184,000
Employer contributions for the year 89,000
Benefits paid to retirees 26,000
Expected return on assets 5%
Actual return on assets 6%
Discount rate 5%

a) Prepare a pension worksheet for Whispering Corporation for 2020.

General Journal Entries

Annual Pension Exp.
Balance, January 1, 2020
Current Service Cost 80,000
Past Service Cost 184,000
Net Interest/Finance Cost 1,700
Asset Remeasurement Gain/Loss (15,000)
Employer Contributions to Pension Fund
Benefits Paid to Retirees from Pension Fund
Pension Expense Entry - 2020 250,700
Net Funding Entry
Balance, December 31, 2020

b) Prepare pension plan journal entries for Whispering Corporation for 2020.

To record pension expense

Pension Expense 250,700
Net Defined Liabilities/Assets 250,700

To record payment to pension fund

Net Defined Liabilities/Assets 89,000
Cash 89,000

c) What is the funded status for Whispering Corporation at December 31, 2020?

Underfunded by: 11,700

 Whispering’s financial records indicated the following information related to the company’s defined benefit pension plan:

General Journal Entries Memo Record

Cash Net Defined Liability/Asset Defined Benefit Obligation Plan Assets
150,000 (1,350,000) 1,500,000
(80,000)
(184,000)
(76,700) 75,000
15,000
(89,000) 89,000
26,000 (26,000)
(250,700)
(89,000) 89,000
(11,700) (1,664,700) 1,653,000
efit pension plan:
Metlock Corporation is a publicly owned company that follows IFRS. On December 31, 2019, Metlock’s financial records indica

Defined Benefit Obligation $7,547,900

Pension Plan Assets 7,254,200

On January 1, 2020, Metlock acquired the operations of AMX Ltd. As one of the conditions of the purchase, Metlock agreed th
service of AMX’s employees. The actuary estimated the value of the prior service amount granted on January 1, 2020 to be $3

Metlock’s actuary provided the following information on December 31, 2020:

Current year service cost $377,700

Employer contributions for the year 441,300
Benefits paid to retirees 158,200
Actuarial increase in pension obligations 127,700
Expected return on assets 6%
Actual return on assets 5%
Discount rate 6%

a) Prepare a pension worksheet for Whispering Corporation for 2020.

Balance, January 1, 2020

Current Service Cost
Past Service Cost
Net Interest/Finance Cost
Asset Remeasurement Gain/Loss
Actuarial Gain/Loss
Employer Contributions to Pension Fund
Benefits Paid to Retirees from Pension Fund
Pension Expense Entry - 2020
Net Funding Entry
Balance, December 31, 2020

b) Prepare pension plan journal entries for Whispering Corporation for 2020.

To record pension expense

Pension Expense 748,514
Remeasurement Loss (OCI) 200,242
Net Defined Benefit Liability or Asset 948,756

To record payment to the pension fund

To record payment to the pension fund 441,300
To record payment to the pension fund 441,300
c) What is the funded status for Whispering Corporation at December 31, 2020?

Underfunded by: 801,156

n December 31, 2019, Metlock’s financial records indicated the following information related to the company’s defined benefit pension pla

ne of the conditions of the purchase, Metlock agreed that AMX’s employees would be included in Metlock’s defined benefit pension plan,
or service amount granted on January 1, 2020 to be $333,200.

General Journal Entries

Remeasurement (Gain) Loss OCI Annual Pension Exp. Cash Net Defined Liability/Asset
(293,700)
377,700
333,200
37,614
72,542
127,700
(441,300)

200,242 748,514 (948,756)

(441,300) 441,300
(801,156)
ny’s defined benefit pension plan:

s defined benefit pension plan, and would be granted credit for the past

Memo Record
Defined Benefit Obligation Plan Assets
(7,547,900) 7,254,200
(377,700)
(333,200)
(472,866) 435,252
(72,542)
(127,700)
441,300
158,200 (158,200)

(8,701,166) 7,900,010
Oriole Corporation sponsors a defined benefit pension plan for its 100 employees. On January 1, 2020, the company’s actuary

Pension plan assets (fair value) $1,000,000

Defined benefit obligation 1,410,000

The actuary calculated that the present value of future benefits earned for employee services rendered in 2020 amounted to
was 9%. The plan assets generated a return of $80,600 during 2020. The company funded the 2020 current service cost as we
year. Oriole Corporation is a private company and applies ASPE.

a) Prepare a schedule that indicates what the plan’s surplus or deficit is at December 31, 2020.

Defined Benefit Obligation, Jan. 1, 2020 1,410,000

Add: Interest 126,900
Add: Current Service Cost 213,200
Defined Benefit Obligation, Dec. 31, 2020 1,750,100
Liability (Loss)/Gain 75,100
Actuarial Valuation of DBO, Dec. 31, 2020 1,825,200

Plan Assets, Jan. 1, 2020 1,000,000

Actual Return, 2020 80,600
Contributions 319,800
Plan Assets, Dec. 31, 2020 1,400,400
Plan Deficit, December 31, 2020 424,800

b) Determine the pension expense that the company will recognize in 2020.

Current service cost 213,200

Net interest/finance cost 36,900
Asset remeasurement loss 9,400
Liability loss 75,100
Pension Expense for 2020 334,600

c) Prepare the journal entries to record pension expense and the company’s funding of the pension plan in 2020.

To record pension expense

Pension Expense 334,600
Net Defined Benefit Liabilities/Assets 334,600

To record contributions to the pension fund

Net Defined Benefit Liabilities/Assets 319,800
Cash 319,800

d) Prepare the journal entries to record pension expense and the company’s funding of the pension plan in 2020, assuming Or

To record pension expense

 Pension Expense 250,100
Net Defined Benefit Liability/Asset 250,100

To record remeasurement loss

Remeasurement Loss (OCI) 84,500
Net Defined Benefit Liability/Asset 84,500

To record contributions to the pension fund

Net Defined Benefit Liability/Asset 319,800
Cash 319,800
0, the company’s actuary provided the following information:

ed in 2020 amounted to $213,200, the December 31, 2020 defined benefit obligation was $1,825,200, and the appropriate interest or disc
urrent service cost as well as $106,600 of the past service costs recognized in a previous year; however, no benefits were paid during the

lan in 2020.

lan in 2020, assuming Oriole applied IFRS.

 he appropriate interest or discount rate
benefits were paid during the
Bridgeport Ltd. has a one-person pension plan that promises the employee a pension on retirement according to the following
January 2009 at the age of 30. She expects to retire in January 2038, the month of the year in which she turns 60. Her life expe
Assume that this employee earned an annual salary of $50,700 when she joined Bridgeport, that her salary was expected to in
Bridgeport considers a discount rate of 5% to be appropriate.

a) What is the employee’s expected final salary?

Employee's Final Salary: 208,688

b) What amount of current service cost should Bridgeport recognize in 2020 relative to this plan? Use PV tables, a financial cal

PMT 4,174
Rate 5.00%
Period 25
Future Value -
PV in 2035 58,825

PMT -
Rate 5.00%
Period 18
Future Value 58,825
PV in 2020 24,443

c) What is the amount of the defined benefit obligation at December 31, 2020?

Benefits earned, Jan. 1, 2009 to Dec. 31, 2020 50,085

PV of annuity, Dec. 31, 2038 705,897
PV of annuity, Dec. 31, 2020 293,315
 according to the following formula: pension benefit = 2% of final salary per year of service. The employee began employment with  Bridge
she turns 60. Her life expectancy at that time is 25 years.
r salary was expected to increase at a rate of 5% per year, and that this remains a reasonable assumption to date.

e PV tables, a financial calculator or Excel functions to arrive at the answer.

egan employment with  Bridgeport in