Defined Benefit Scheme

This topic has 2 replies, 3 voices, and was last updated 12 years ago by MikeLittle.

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October 24, 2013 at 6:18 am #143518
nrjsma
Participant
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What will be the double entry for Contributions of $2million?

What will be the double entry for Benefits paid $1 million?
October 24, 2013 at 3:24 pm #143583
frafiq81
Participant
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Hi,

I hope its correct, but I am sure Sir Mike will correct me if i am wrong

Double entry for Contributions (in the plan) of $ 2million

Dr Pension (Asset) 2 million
Cr Cash 2 million

Double entry for Benefits paid $1 million

Dr Pension (Liability) $ 1 million
Cr Cash $ 1 million
October 24, 2013 at 4:16 pm #143592
MikeLittle
Keymaster
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Hmmm, nearly right frafiq and potentially absolutely correct if you add a bit more detail.

My double entry would be:

Dr Pension Plan Assets (cash) 2m
Cr General Cash (from company’s own resources) 2m

and

Dr Pension Plan Liabilities 1m
Cr Pension Plan Assets (cash) 1m
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