How to Account for Post-Retirement Benefits


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question 1 of 3

The company expects to pay $70,000 for Joe's post-retirement benefits. He will be eligible for the plan after 30 years of service. He has been working for the company for 20 years. How much of the company's APBO is attributable to Joe?

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1. If service cost for 2017 is $3,000, interest cost is $500 and expected gain on plan assets is $1,000 how much is post-retirement pension expense?

2. If service cost for 2017 is $6,000, interest cost is $1,000, expected and actual gain on plan assets is $2,000 and the company contribution is $2,000 how much does the post-retirement pension liability increase by?

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About This Quiz & Worksheet

Refer to this quiz/worksheet assessment tool to quickly measure what you know about accounting processes for post-retirement benefits. You must be able to understand specific phrases and how to apply these processes in order to satisfactorily answer all quiz questions.

Quiz & Worksheet Goals

On this quiz, you must demonstrate the ability to:

  • Solve sample accounting problems relating to post-retirement benefits
  • Explain expected post-retirement benefit obligation (EPBO)
  • Define accumulated post-retirement benefit obligation (APBO)

Skills Practiced

  • Problem solving - use acquired knowledge to solve sample post-retirement benefits accounting problems
  • Defining key concepts - ensure that you can accurately define APBO
  • Information recall - access the knowledge you've gained regarding EPBO

Additional Learning

Review further details about this topic by studying the lesson called How to Account for Post-Retirement Benefits. You will have the opportunity to learn more about:

  • What post-retirement benefits can include
  • Which obligation is beyond the scope of accounting
  • Why APBO will increase in a given example
  • What contentious area is being studied by the Financial Accounting Standards Board