In the Kaplan schweser video on total pension cost calculations under US GAAP, there is a OCI calculation of $101.
Service cost $8000
Interest cost $13250 [$132500 Beg PBO X 10%]
Exp Return ($9576) [$79800 FV of planned asset X 12%]
Prior SC $100 [$2000/20 yrs = 100]
Acturial G/L $ 375 [$7500/20 yrs = 375]
Pension Exp $12,149
OCI $ 101
Tot Pen Cost $12,250
This has been arrived upon by the following method
OCI CALCULATIONS:-
Amortized loss (375) [7500 Amortized over 20 years being the 10% corridor difference between Begining Unamortized loss $20750 - $13250 (PBO* Discount rate)]
Unrecognized gain (1424) [$11000 actual return - $9576 expected return]
Unregonized loss 1900 [$2,000 prior service cost - $100 Amortized (taken to I/S)]
OCI Net change 101
What is confusing is that while doing OCI calculaitons the amortized acturial Loss of $375 is used to reduce OCI, while it is clearly taken into the income statement as an Amortized loss.
Could someone help me and save my Soul !! Thanks a ton in advance !!