Gorky-Park Corporation provides postretirement health care benefits to employees who provide at least 12 years of service and reach age 62 while in service

Gorky-Park Corporation provides postretirement health care benefits to employees who provide at least 12 years of service and reach age 62 while in service. On January 1, 2011, following plan-related data were available

Accumulated postretirement benefit obligation 130
Fair value of plan assets none
Average remaining service period to retirement 25 years (same in previous 10 yrs)
Average remaining service period to full eligibility 20 years (same in previous 10 yrs)

On January 1, 2011, Gorky-Park amends the plan to provide certain dental benefits in addition to previously provided medical benefits. The actuary determines that the cost of making the amendment retroactive increases service cost for 2011 is $34 million. The interest rate is 8%.

Requirements
1. Calculate the postretirement benefit expense for 2011.
2. Prepare the journal entry to record the expense.


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Briefly describe at least two similarities and two differences between U.S. GAAP and iGAAP with respect to income tax accounting

Briefly describe at least two similarities and two differences between U.S. GAAP and iGAAP with respect to income tax accounting.

Click here for the solution: Briefly describe at least two similarities and two differences between U.S. GAAP and iGAAP with respect to income tax accounting

An analyst predicted last year that the stock of Logistics, Inc., would offer a total return of at least 10% in the coming year

E8–1 An analyst predicted last year that the stock of Logistics, Inc., would offer a total return of at least 10% in the coming year. At the beginning of the year, the firm had a stock market value of $10 million. At the end of the year, it had a market value of $12 million even though it experienced a loss, or negative net income, of $2.5 million. Did the analyst’s prediction prove correct? Explain using the values for total annual return.

Click here for the solution: An analyst predicted last year that the stock of Logistics, Inc., would offer a total return of at least 10% in the coming year