Use the following information for questions 68 through 70.
The following information for Cooper Enterprises is given below: There were no actuarial gains or losses at January 1, 2015. The average remaining service life of employees is 10 years.
-What is the amount that Cooper Enterprises should report as its pension liability on its balance sheet as of December 31, 2015?

Question

Use the following information for questions 68 through 70.
The following information for Cooper Enterprises is given below:  There were no actuarial gains or losses at January 1, 2015. The average remaining service life of employees is 10 years.
-What is the amount that Cooper Enterprises should report as its pension liability on its balance sheet as of December 31, 2015?

Quizplus · Accepted Answer

The pension liability is the present value of the expected future pension payments minus the fair value of the plan assets. In this case, the present value of the expected future pension payments is $800,000 and the fair value of the plan assets is $200,000. Therefore, the pension liability is $800,000 - $200,000 = $600,000.

Use the Following Information for Questions 68 Through 70