Question

1. The following information pertains to Rembrandt Inc.'s pension plan for calendar 2017:

      Defined benefit obligation at Jan 1/17.................     $96,000

      Interest (discount) rate......................................          10%

      Current service costs.........................................     $24,000

      Pension benefits paid retirees............................     $20,000

The corporation uses IFRS. If no change in actuarial estimates occurred during 2017, Rembrandt's defined benefit obligation at December 31, 2017 would be (show your work)

a) $85,600.

b) $100,000.

c) $105,600.

d) $109,600.

2. Presented below is information related to Peach Corporation’s defined benefit pension plan for calendar 2017. The corporation uses IFRS.

      Defined benefit obligation, Jan 1........................ $200,000

      Fair value of plan assets, Jan 1..........................     180,000

      Current service cost..........................................       27,000

      Contributions to plan.........................................       25,000

      Actual and expected return on plan assets.........        9,000

      Benefits paid to retirees.....................................       40,000

      Interest (discount) rate......................................          10%

The fair value of the plan assets at December 31, 2017 is (5 marks)

a) $187,000.

b) $174,000.

c) $165,000.

d) $149,000.

3. Presented below is pension information related to Apple Inc. for the calendar year 2017. The corporation uses the immediate recognition approach.

      Current service costs......................................... $288,000

      Interest on accrued benefit obligation.................     216,000

      Expected and actual return on plan assets.........       72,000

      Past service costs.............................................       48,000

The pension expense to be reported for 2017 is (5 marks)

a) $432,000.

b) $480,000.

c) $576,000.

d) $648,000.

4. Presented below is pension information related to Watermelon Corp. for the calendar year 2017. The corporation uses IFRS.

      Current service cost.......................................... $126,000

      Discount (interest) rate......................................          10%

      Defined benefit obligation, Jan 1........................ $900,000

      Actual & expected return on plan assets.............       24,000

      Actuarial loss....................................................       28,000

The pension expense to be reported for 2017 is (4 marks)

a) $220,000.

b) $192,000.

c) $164,000.

d) $130,000.

5. The following information is available for Figgy Enterprises Ltd. for calendar 2017. The corporation uses IFRS.

      Plan assets (at fair value), end of year................ $1,800,000 Dr

      Defined benefit obligation, end of year................ 1,920,000    Cr

      Pension expense..............................................    360,000

      Contributions for year........................................     324,000

The pension expense to be reported for 2017 is (1 mark)

a) $360,000.

b) $346,000.

c) $324,000.

d) $120,000.