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timama [110]
3 years ago
13

g Floyd Corporation had a projected benefit obligation of $3,142,000 and plan assets of $3,308,000 at January 1, 2020. Floyd als

o had a net actuarial loss of $438,720 in accumulated OCI at January 1, 2020. The average remaining service period of Floyd's employees is 7.10 years. Compute Floyd's minimum amortization of the actuarial loss. What amount should pension expense be debited due to minimum amortization of the actuarial loss
Business
1 answer:
Lorico [155]3 years ago
7 0

Answer:

Floyd Corporation

a. Projected benefit obligation, 01/01/2020 =  $ 3,142,000

b. Plan asset value, 01/01/2020   =                  $ 3,308,000

Corridor:

10% of greater of (a) or (b) [(b) in this case] =     $330,800

Actuarial loss =                                                    ($438,720)

a) Minimum Amount to be amortized =              $107,920

Average remaining service life of employees = 7.10  years

b) Amount to include in pension cost for 2020 = $15,200

Explanation:

Floyd is required to use the Corridor approach to determine the amount of gains and losses to recognize (amortize) in pension expense each period.  The corridor approach is a technique used to reduce the amounts of gains and losses to be recognized as an adjustment to pension expense.

With this technique gains and losses in excess of 10 percent of the greater of the projected benefit obligation or the market-related asset value are recognized.  The 10 percent is the corridor.

Any excess over the 10 percent should be amortized over the average remaining service period of active employees expected to participate in the plan.  This amount represents the minimum amount a company can recognize.   No gain or loss is recognized when the gains or losses are not in excess of 10% of the appropriate amount.

The corridor reduces the volatility of the pension expense.

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alekssr [168]

Answer:

answer is A) $206 B) $61.31

Explanation:

to calculate price of the stock at zero we use dividend discount model formula

P0= D(1+G)/(r-g)

     10(1.03)/(0.08-0.03)

       $206

b) The dividend is said to be 2% of the free cash flow therefore can be calculated as $10*0.2=$2 per share

then calculate divide growth rates

D1=2*1.3 =2.6

D2=2*(1.3)(1.3)=3.38

D3 = 2*(1.3)(1.3)(1.3)=4.394

Claculate the discount rate using CAPM according to given information

R= 0.2+ 1.5(0.08-0.02)

 = 0.11/11%

Use the dividend discount model to calculate the price of the stock

P0= 2.6/1.11+3.38/1.3²+4.394*(1.05)/(0.11-0.05)

2.342+2.743+56.225

=$61.31

7 0
3 years ago
The customer requires ICC(A). Considering that the insurance policies of China’s domestic insurance companies are all based on C
svetlana [45]

The Chinese insurance market has grown at a furious pace in recent years and will surpass that of the United States by 2029.

A strong economy, government investment, consumer awareness, and technology are fuelling China's growth in the insurance sector.

China's biggest insurance companies are among the largest companies in the world.

8 0
3 years ago
An activity-based costing system ______. requires substantial resources provides benefits of improved accuracy that always outwe
Mashcka [7]

Answer:

1. Requires substantial resources.

2. produces different numbers than a traditional system.

3. Is costly to maintain.

Explanation:

Activity-based costing (ABC) system is a method of accounting assigns the total cost of activities such as manufacturing overhead costs and indirect costs necessary to produce a product or provide a service.

Basically, an activity-based costing (ABC) system is focused on the cost drivers associated with the respective activities, which are responsible for cost to be incurred. The cost drivers are activities such as direct labor, purchase order, machine use etc.

<em>Hence, an activity-based costing system requires substantial resources, produces different numbers than a traditional system and is costly to maintain.</em>

5 0
2 years ago
_____ refers to the process of combining aspects of reporting, data exploration and ad hoc queries, and sophisticated data model
8090 [49]

Answer:

C.business intelligence is the correct answer.

Explanation:

  • Business intelligence applies to applications and technologies used by the enterprises for the integration,data presentation, and analysis of business information.
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  • Companies use business intelligence to find out the new market opportunities,for cost-cutting and to identify the ineffective business methods.
7 0
2 years ago
"A customer calls a registered representative to sell 500 shares of an over-the-counter stock and tells the representative that
lorasvet [3.4K]

Answer:

Not allowed, FINRA prohibits private securities transactions. Trading must be done with the knowledge of your firm in the public securities markets

Explanation:

Since in the question it is mentioned that call of the customer registered the representative for selling off  500 shares over the counter stock and the transactions should be done in privately

here according to the FINRA, it prohibits the transactions in which the person deals in private securities also there should be knowledge in the firm for the securities market held in market

6 0
3 years ago
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