Questions from Intermediate Accounting

Q: Brandon Components declares a 2-for-1 stock split.

Brandon Components declares a 2-for-1 stock split. What will be the effects of the split, and how should it be recorded?

Q: What is a reverse stock split? What would be the effect

What is a reverse stock split? What would be the effect of a reverse stock split on one million $1 par shares? On the accounting records?

Q: Qualified pension plans offer important tax benefits. What is the special

Qualified pension plans offer important tax benefits. What is the special tax treatment and what qualifies a pension plan for these benefits?

Q: The projected benefit obligation was $80 million at the beginning of

The projected benefit obligation was $80 million at the beginning of the year and $85 million at the end of the year. Service cost for the year was $10 million. At the end of the year, there was no pr...

Q: How should gains or losses related to pension plan assets be recognized

How should gains or losses related to pension plan assets be recognized? How does this treatment compare to that for gains or losses related to the pension obligation?

Q: Is a company’s PBO reported in the balance sheet? Its plan

Is a company’s PBO reported in the balance sheet? Its plan assets? Explain.

Q: A net operating loss occurs when tax-deductible expenses exceed taxable

A net operating loss occurs when tax-deductible expenses exceed taxable revenues. Tax laws permit the net operating loss to be used to reduce taxable income in other, profitable years by either a carr...

Q: Evaluate this statement: The excess of the actual return on plan

Evaluate this statement: The excess of the actual return on plan assets over the expected return decreases the employer’s pension cost.

Q: When accounting for pension costs, how should the payment into the

When accounting for pension costs, how should the payment into the pension fund be recorded? How does it affect the funded status of the plan?

Q: TFC Inc. revises its estimate of future salary levels, causing

TFC Inc. revises its estimate of future salary levels, causing its PBO estimate to increase by $3 million. How is the $3 million reflected in TFC’s financial statements?