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22 May, 04:54

ABC began a defined benefit pension plan for its employees on Jan 1, 2018. The following data are provided for 2018 as of Dec 31, 2018: Projected benefit obligation is $634 Accumulated benefit obligation is $418.44 Plan assets at fair value is $821 Pension expense is $192.48 Employer's cash contribution (end of year) is $361 What amount should ABC report as a net pension liability (asset) at Dec 31, 2018. (Enter net pension liability as a positive amount)

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  1. 22 May, 05:39
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    Answer: $187 ⇒ Amount should ABC report as a net pension liability (asset) at Dec 31, 2018

    Explanation:

    Given that,

    Data for 2018 as of Dec 31, 2018 are as follows:

    Projected benefit obligation = $634

    Accumulated benefit obligation = $418.44

    Plan assets at fair value = $821

    Pension expense = $192.48

    Employer's cash contribution (end of year) = $361

    The amount should company report as a net pension liability at Dec 31, 2018 as follows:

    Net Pension Liability = Projected benefit obligation - Plan assets at fair value

    = $634 - $821

    = $187 ⇒ Amount should ABC report as a net pension liability (asset) at Dec 31, 2018
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