Projected benefit obligation 930,000
Accumulated benefit obligation 865,000
Plan assets (at fair value) 700,000
Vested benefits 200,000
Prior service cost not yet recognized in
pension expense 120,000
Gains and losses 0
Instructions:
(a) Present the schedule reconciling the funded status with the asset/liability reported on the balance sheet. Assume no asset or liability existed at the beginning of period for pensions on Jean Burr Company's balance sheet.
(b) Assume the same facts as in (a) except that Jean Burr Company has an unrecognized loss of $16,000during 2007.
(c) Explain the rationale for the treatment.