At the beginning of the current year,Bridges Corporation has a net gain-Accumulated Other Comprehensive Net Income of $80,000,000.The Projected Benefit Obligation and the plan assets are $500,000,000 and $650,000,000 respectively.The average remaining service period for the employees to receive benefits is 15 years.What is the amount of amortization to pension expense for the year?

Question

Quizplus · Accepted Answer

The amortization of the net gain is calculated by dividing the net gain by the average remaining service period: $80,000,000 / 15 years = $5,333,333. However, since the plan assets exceed the projected benefit obligation by $150,000,000, the excess is not amortized. Therefore, the amortization to pension expense is $1,000,000, which is the minimum amortization required.

At the Beginning of the Current Year,Bridges Corporation Has a Net