(a)

General Ledger
Annual
Pension
Expense

Balance - Jan. 1 2014

Service Cost
Interest Income
Actual Return
Contributions
Benefits
Journal Entry 12/31/14
Accumulated OCI
Balance Dec. 31, 2014
Additional PSC
Jan.1, 2015
Service Cost
Interest Income
Actual Return
Unexpected Loss
Amorization of PSC
Contributions
Benefits
Journal Entry 12/31/2015

Cash

OCI
Gains/Losses

150,000
450,000
-252,000
-240,000
348,000 -240,000

500,000
180,000
540,000
-260,000
-99,360
90,000

99,360
-90,000
-285,000

450,640 -285,000
Accumulated OCI
Balance, Dec. 31,2015

( b ) Journal Entries for 2015

Pension Expense
OCI (PSC)
OCI (G/L)
Cash
Pension Asset/Liability

OCI-Prior
Service Cost

450,640
410,000
99,360
-285,000
-675,000

410,000

99,360

410,000

99,360

HARRINGTON COMPANY
Pension Worksheet - 2014 and 2015
Memo Record
Pension
Asset/
Liabiability
-300,000

Projected
Benefit
Obligation
-4,500,000
-150,000
-450,000

200,000

Plan
Assets
4,200,000

252,000
240,000
-200,000

-108,000
-408,000

-4,900,000
-500,000
-5,400,000
-180,000
-540,000

4,492,000

260,000

280,000

285,000
-280,000

-5,840,000

4,757,000

-675,000
-1,083,000

GOTTSCHALK COMPANY
Pension Worksheet Year Ended 12/31/2014
General Journal Entries
Annual
Pension
OCI-Prior
OCI
Expense
Cash
Service Cost Gains/Losses
Balance - Jan. 1, 2014
Service Cost
-52,000
Interest Cost
38,000
Actual Return
-11,000
Unexpected Loss
-9,000
9,000
Liability Loss
20,000
Contributions
-65,000
Amortization PSC
15,000
Journal Entry 2014
85,000
-65,000
-15,000
29,000
Accumulated OCI Dec. 31
150,000
Balance December 31, 2014
135,000
29,000

LK COMPANY
Year Ended 12/31/2014
Pension
Asset/
Liability
-180,000

Memo Record
Projected
Benefit
Obligation
-380,000
-52,000
-38,000

Plan
Assets
200,000

11,000
-20,000
65,000
-340,000
-214,000

-490,000

( A ) 1)

Cost of equipment
Less:
Depreciable cost
Depreciation to 2014
2011 (80,000 x 10)
2012 (80,000 x 10)
2013 (80,000 x 10)

Depreciation in 2014
Cost of equipment
Less: Depreciation to 2014
Book value (Jan. 1, 2014)
Less: Salvage value
Depreciable cost

HOLTZMAN COMPANY
85,000
5,000
80,000

8,000
8,000
8,000
24,000

85,000
24,000
61,000
3,000
58,000

Depreciation in 2014
58,000/4 = 14,500
Depreciation Expense
Accumulated Depreciation - Equipment
2Cost of Building
Less:
Depreciation to 2014
2012
2013
Book value (Jan. 1, 2014)
Less: Salvage value
Depreciable Cost

14,500
14,500

300,000
60,000
48,000
192,000
30,000
162,000

Depreciation in 2014
(162,000/8 = 20,250
Depreciation Expense
Accumulated Depreciation -Buildings

20,250

3 Depreciation Expense (120,000 - 16,000) 8

Accumulated Depreciation - Machinery

13,000

Accumulated Depreciation - Machinery

Retained Earnings
Depreciation recorded in 2012 (120,000 8) x 1/2

20,250

13,000
3,000
3,000

Depreciation that should be recorded in 2012 9[120,000 - 16,000] 8) x 1/2

Depreciation recorded in 2013 (120,000 8)
Depreciation that should be recorded in 2013 (120,000 - 16,000) 8
Depreciation taken
2012
7,500
2013
15,000
22,500
(b)

Comparative Income Statements

Income before depreciation expense
Depreciation Expenses
Net Income

Depreciation that should be taken

6,500
13,000
19,500
2014
300,000
47,750
252,250

7,500

] 8) x 1/2

6,500
15,000
13,000

ld be taken

Difference
1,000
2,000
3,000
2013
310,000
69,000
241,000

BOTTICELI INC.
(A)

Inventory

14,000
Retained Earnings

14,000

(19,000 + 23,000 + 25,000) - (15,000 + 18,000 + 20,000)

(B)

Net Income (FIFO)

(c)

Inventory

2013
2014
2015

19,000
23,000
25,000
24,000

Retained Earnings
(19,000 + 23,000 + 25,000) - ( 12,000 + 14,000 + 17,000)

24,000