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gulaghasi [49]
3 years ago
14

The following incomplete (columns have missing amounts) pension spreadsheet is for the current year for First Republic Corporati

on (FRC). ($ in millions) Debit(Credit) PBO Plan Assets Prior Service Cost Net (Gain)/Loss Pension Expense Cash Net Pension (Liability)/ Asset Beginning balance (880 ) 44 (106 ) Service cost 78 Interest cost 44 Expected return on assets 84 Gain/loss on assets (2 ) Amortization of: Prior service cost (7 ) Net gain/loss 3 Loss on PBO (8 ) Contributions to fund (61 ) Retiree benefits paid (81 ) Ending balance 877 (97 ) What was the net pension asset/liability reported in the balance sheet at the end of the year
Business
1 answer:
lisov135 [29]3 years ago
5 0

Answer:

$(52)

Explanation:

Calculation to determine the net pension asset/liability reported in the balance sheet at the end of the year

First step is to calculate the Ending PBO using this formula

Ending PBO=(Asset Beginning balance)+(Service cost)+(Interest cost)+(Loss on PBO)+Retiree benefits

Let plug in the formula

Ending PBO = $(880) + ($78) + ($44) + ($8) + $81

Ending PBO= $(929)

Now let calculate the Net pension liability

Using this formula

Net pension liability=(Ending PBO)+Ending balance

Let plug in the formula

Net pension liability = $(929) + $877

Net pension liability= $(52)

Therefore the net pension liability reported in the balance sheet at the end of the year is $(52)

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