computation of actual return gains and losses corridor test and pension expense 460858

(Computation of Actual Return, Gains and Losses, Corridor Test, and Pension Expense)

Erikson Company sponsors a defined benefit pension plan. The corporation’s actuary provides the following information about the plan.

January 1 December 31

2012

2012

Vested benefit obligation $1,500 $1,900

Accumulated benefit obligation 1,900 2,730

Projected benefit obligation 2,500 3,300

Plan assets (fair value) 1,700 2,620

Settlement rate and expected rate of return 10%

Pension asset/liability 800 ?

Service cost for the year 2012 400

Contributions (funding in 2012) 700

Benefits paid in 2012 200

(If answer is zero, please enter a 0, do not leave any fields blank.)

(a) Compute the actual return on the plan assets in 2012.

$

(b) Compute the amount of the other comprehensive income (G/L) as of December 31, 2012. (Assume the January 1, 2012, balance was zero.)

$

(c) Compute the amount of net gain or loss amortization for 2012 (corridor approach).

$

(d) Compute pension expense for 2012.