1. Farris Electronics amended its pension plan effective January 1, 2015. The increase in the PensionBenefit Obligation occurring as a result of the plan amendment is $ 6,290,000. Farris arranged to fundthe prior service cost by equal annual contributions over the next 15 years at 10% interest. Farris willmake the first payment on December 31, 2015. The company decides to amortize the prior service coston a straight-line basis over the average remaining service life of its employees. As at January 1, 2015,the company has 225 employees who are entitled to the benefits of the amendment. Farris estimatesthat an average of 15 employees will retire each year.1. Compute the amount Farris will pay each year to fund the prior service cost arising from the plansamendment.2. Compute Farriss annual prior service cost amortization based on average remaining years ofemployee service.2. Concept Financial has a defined benefit pension plan for its employees. The following were thebalances for the pension plan as of January 1, 2015:Annual Benefit Obligation $3,500,000Pension Benefit Obligation 3,900,000Deferred pension gain 420,000Fair value of the pension fund 3,300,000Market-related value of the pension fund ( five-year weighted average) 2,850,0003The pension plan would earn 12% of the market-related value of the pension fund in 2015. The actualreturn on the pension fund was $315,000. The company has elected to amortize the deferred pensiongains and losses over 10 years.Answer the following questions:1. Compute the amount of deferred gain or loss for 2015.2. Compute the amount of amortization of deferred pension gain or loss for 2015.3. Computed pension expense is $ 534,000. However, this computation ignores any deferred gains orlosses for the year (in other words, actual, not expected return on the pension fund was included in thecomputations) as well as any amortization of deferred gains or losses from prior years. What is pensionexpense after considering the impact of deferred gains and losses and their amortization?4. What is the deferred pension gain or loss that Concept will carry forward to 2016?Your well-written paper must include title and reference pages. The paper should be formattedaccording to the CSU-Global Guide to Writing and APA Requirements. Any supporting calculationsshould be inserted in a table in your Word document. Do not submit two separate documents, as onlyone document can be accepted
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