Persoff Industries International has a defined benefit pension plan. The company revised its estimate of future salary levels causing its defined benefit obligation to increase by $16 million. Also, Persoff's $25 million actual return on plan assets exceeded the 5% high-grade corporate bond rate times the $440 million plan assets. Persoff prepares its financial statements in accordance with International Financial Reporting Standards (IFRS). The company will:

Question

Quizplus · Accepted Answer

$\begin{array}{|l|r|r|}
\hline\text { Plan assets } & 3 & \
\hline \text { Remeasurement gain-OCI } & & 3 \
\hline \
\hline \text { Loss-OCI } &16 & \
\hline \text { DBO } && 16  \
\hline
\end{array}$ Using IFRS, the gain and the loss become part of AOCI in the equity section of the balance sheet. We do not subsequently amortize that amount.

Persoff Industries International Has a Defined Benefit Pension Plan