Jamieson Corp.sponsors a defined benefit plan for its employee group. The following data pertains to the plan's first 2 years in existence: Jamieson's balance sheet as per IFRS for Year 1 would show an accumulated other comprehensive income (AOCI)balance of:
A) $3,000 dr.
B) $3,000 cr.
C) $2,700 dr.
D) $2,700 cr.

Question

Jamieson Corp.sponsors a defined benefit plan for its employee group. The following data pertains to the plan's first 2 years in existence:  Jamieson's balance sheet as per IFRS for Year 1 would show an accumulated other comprehensive income (AOCI)balance of:
A) $3,000 dr. 
B) $3,000 cr. 
C) $2,700 dr. 
D) $2,700 cr.

Quizplus · Accepted Answer

The AOCI balance for a defined benefit plan is calculated as the difference between the fair value of the plan's assets and the present value of its projected benefit obligation. In Year 1, the fair value of the plan's assets was $200,000 and its projected benefit obligation was $197,300, resulting in an AOCI balance of $2,700 (dr) [$200,000 - $197,300 = $2,700 (dr)].