Gordon Corporation adopts acceptable accounting for its defined benefit pensionplan on January 1, 20x3, with the following beginning balances:Plan assets$380,000Projected benefit obligation455,00020x320x420x5Plan assets??Projected benefit obligation??Actual return on plan assets$30,000 $39,000$45,000Amortization of prior service cost$55,600$71,800Annual funding (contributions)$86,000$90,000$198,000Annual service cost$35,000$45,000$30,000Benefits paidExpected rate of returnMarket related value of plant assetsPrior service cost (plan amended, 1/1/x4)Projected benefit obligation established atDecember 31, 20x5 for change in actuarialassumptionsSettlement rate (Interest costs)$28,000$29,400$39,00010%12%10%$580,000$190,000$710,0008%9%10%

Information Needed:Discount rate (assumed): This is typically close to the settlement rate but can…

Answered: Gordon Corporation adopts acceptable…

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter19: Accounting For Post Retirement Benefits

Section: Chapter Questions

Problem 1E

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