Question

7) Presented below is information related to Noble Inc. as of December 31, 2018. Accumulated OCI (G/L) $ 120,000 Projected benefit obligation 4,870,000 Accumulated benefit obligation 4,560,000 Vested benefits 2,160,000 Plan assets (at fair value) 4,472,000 Accumulated OCI (PSC) -0- The amount reported as the pension liability on Noble's balance sheet at December 31, 2018 is

Answer 1

Answer:

$398,000

Explanation:

Data provided

Projected benefit obligation = $4,870,000

Plan assets = $4,472,000

The calculation of pension liability on Noble's balance sheet is shown below:-

= Projected benefit obligation - Plan assets (at fair value)

= $4,870,000 - $4,472,000

= $398,000

Therefore for computing the pension liability on Noble's balance sheet we simply deduct the plan assets from projected benefit obligation.