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Chapter 20: Question 22Q (page 1161)

Boey Company reported net income of \(25,000 in 2018. It had the following amounts related to its pension plan in 2018: Actuarial liability gain \)10,000; Unexpected asset loss $14,000; Accumulated other comprehensive income (G/L) (beginning balance), zero. Determine for 2018 (a) Boey’s other comprehensive income, and (b) comprehensive income.

Short Answer

Expert verified

The comprehensive income statement is prepared along with the income statement. It states the value of total incomethat will be represented under the balance sheet.

Step by step solution

01

(a) Computation of Boey’s other comprehensive income for the year 2018.

Particulars

Amount

Actuarial liability gain

$10,000

Less: Asset loss

$14,000

Other comprehensive loss

($4,000)

02

(b) Computation of comprehensive income of Boey’s for the year 2018.

Particulars

Amount

Net Income

$25,000

Less: Other comprehensive loss (Step 1)

$4,000

Comprehensive Income

$21,000

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Most popular questions from this chapter

Latoya Company provides the following selected information related to its defined benefit pension plan for 2017. Pension asset/liability (January 1) \( 25,000 Cr. Accumulated benefit obligation (December 31) 400,000 Actual and expected return on plan assets 10,000 Contributions (funding) in 2017 150,000 Fair value of plan assets (December 31) 800,000 Settlement rate 10% Projected benefit obligation (January 1) 700,000 Service cost 80,000 Instructions (a) Compute pension expense and prepare the journal entry to record pension expense and the employer’s contribution to the pension plan in 2017. Preparation of a pension worksheet is not required. Benefits paid in 2017 were \)35,000. (b) Indicate the pension-related amounts that would be reported in the company’s income statement and balance sheet for 2017.

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