Peyton Approved has revised its postretirement plan. It will now provide health insurance to retired employees. Management has requested that you report the short- and long-term financial implications of this.

Postretirement Benefits

· The company is currently employing 60, and actuaries estimate that the company has a pension liability of $107,041.70.

· The estimated cost of retired employees’ health insurance is $43,718.91.

· Prepare adjusting entries for the pension liability and the health insurance liability

Leases

· Six ovens were rented on December 31, with $20,000 charged to rent expense. The lease runs for 6 years with an implicit interest rate of 5%. At the end of the 6 years, Peyton will own them. Make any necessary adjusting entries.

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ekkarill92 answered 1 year ago

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