Question

Hicks Cable Company has a defined benefit pension plan. Three alternative possibilities for pension-related data at January 1, 2018, are shown below: ($ in 000's)

	CASE 1	CASE 2	CASE 3
Net loss (gain)–AOCI, Jan. 1	$320	($330)	$260
2018 loss (gain) on plan assets	(11)	(8)	2
2018 loss (gain) on PBO	(23)	16	(265)
Accumulated benefit obligation, Jan	(2,950)	(2,550)	(1,450)
Projected benefit obligation, Jan. 1	(3,310)	(2,670)	(1,700)
Fair value of plan assets, Jan. 1	2,800	2,700	1,550
Average remaining service period of active employees (years)	12	15	10

Required:

1. For each independent case, calculate any amortization of the net loss or gain that should be included as a component of pension expense for 2018.

2. For each independent case, determine the net loss–AOCI or net gain–AOCI as of January 1, 2019.

Answer 1

gain loss or of pension that from expense for 2018. | I case 3 (1700) Solution 1. calculation of amortization of net part or incanded as a component Particulars I case 1 I case 2 Projected benefit doliga- tion, Jan 1 (3310) (2670) tess Accumulated Fair value of Plon 2800 270o Abet, Jan 1 Loss (gain) 510 (30) * Average remaining Senure period 12 15 42.50 (2 ) ISSO 150 10 (11) loss (gain) on plan Abet Cb) Loss (gain on PBO (0) (265) 23) Total (0)+(b)+60 8.5 (258) Solution of Net loss / Net gain - Nocl as on Jan 1, 2019 case 1 Case 3 2. calculation Particulars opening from solution 1. case 2 (330) 320 8.5 260 (258) Net loss (gain) ACI 328.50 (324) [Note: All values are in $ in ooo's)