1 PBO actuarial gain 150,000

PA actual return 450,000

PA interest income 500,000 (50,000)
OCI remeasurement gain 100,000

2 Final salary - year 3 144,000

Amount of benefit 14,400

First year 14,400 0.9070 13,060.80

Second year
Service cost 14,400 0.9524 13,714.56
Interest (13,060.8*5%) 13,061 0.0500 653.04
14,367.60

Total 27,428.40

EB OCI
3 beginning balances
Service cost 1,000,000
Interest expense (10% of PBO) 900,000
Interest income (10% of PA) (800,000)
Actual return - interest income (50,000)
PBO actuarial increase 160,000
1,100,000 110,000

Employer contribution
Payment to retirees
end balances

Entry in the journal

EB 1,100,000
Accrued benefit obligation 1,100,000

OCI 110,000
Accrued benefit obligation 110,000

Accrued benefit obligation 800,000

Cash 800,000

4 Liability beginning
Less: pre-2017
liability 2018 and prior
 vacations earned in 2019
increase in 2018 and prior liability (10%)
expense for 2019

5 Final salary 10,000 1.40255

Benefit (1%)

benefit expense in year 1 140 0.6830

benefit expense in year 2
service cost 140 0.7513
interest 96 0.10

liability balance year 2

6 ABO after amendment

ABO before amendment
past service cost adjustment

7 PV asset ceiling 2019

PV asset ceiling 2018
Charged to OCI

8 PBO, start
interest (10% of PBO)
benefits paid
service cost
PBO, end

9 acquisition cost
share in profit
dividend

10 acquisition cost
share in profit
dividend
balance, end

11 acquisition
dividend
 investment income (640000+200000)

12

13 investment income 2019

no adjustment to 2018 income
 Prepaid/
Cash Accrued BO PA PBO
(1,000,000) 8,000,000 (9,000,000)
(1,000,000)
(900,000)
800,000
50,000
(160,000)
(1,100,000)
(110,000)
(800,000) 800,000 800,000
(780,000) 780,000
(1,410,000) 8,870,000 (10,280,000)

35,000
(20,000)
15,000
 30,000
1,500
31,500

14,026
140

96 5 140 1 140
4 140 0.909 127.26
105 3 140 0.8264 115.696
10 2 140 0.7513 105.182
115 1 140 0.683 95.62
700
210

1,425,000
950,000
475,000

2,000,000
1,600,000
400,000

4,600,000
460,000
(390,000)
59,000 squeezed figure
4,729,000

2,500,000
20,000
(60,000)
2,460,000

435,000
75,000
(30,000)
480,000

3,000,000
(120,000)
 840,000
3,720,000

15,000,000
35,000,000
50,000,000

6,000,000
0
 12.726 139.986
11.5696 12.72656 139.9922
10.5182 11.57002 11.6752 138.9454
9.562 10.5182 10.61382 10.62338 136.9374