Using the following key, identify the effects of the following transactions or conditions on the various...

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Using the following key, identify the effects of the following transactions or conditions on the various financial statement elements: I = increases; D = decreases; NE = no effect.

Note that the questions pertain to the employer’s financial statements, not to the pension plan’s financial statements. Analyze effects on the current year only.

DO NOT LEAVE ANY ITEM BLANK

Will someone please confirm all entries are correct?

Not sure about SE, and those reflecting no effect in assets/liabilities (for example - not sure if the increase in liability decreases assets, or there is no effect).

business accounting

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Answer 1

Answer #1

Effects of given transactions or conditions on the elements of financial statements are as follows:

Pension plan events or conditions	Assets	Liabilities	Shareholders’ equity	Net income
Employees performing current services		I		D
Plan amendment grants retroactive benefits		I
Projected benefit obligation accrues interest at the settlement rate		D		D
Unexpected increases in PBO due to changes in actuarial assumptions		D
Retried employees are paid benefits		D
Contributions made to plan trustee	I			I
Plan assets increase by expected return from investing	I			D
Unexpected decrease in FMV of plan assets due to an asset loss	D
Amortization of prior service cost	NE
Amortization of gain	NE

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Answer 2

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Using the following key, identify the effects of the following transactions or conditions on the various...

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