Blossom Company sponsors a defined benefit pension plan for its employees. The following data relate to the operation of the plan for the years 2020 and 2021. 2020 2021 Projected benefit obligation, January 1 $601,000 Plan assets (fair value and market-related value), January 1 413,800 Pension asset/liability, January 1 187,200 Cr. Prior service cost, January 1 161,600 Service cost 40,200 $59,000 Settlement rate 10 % 10 % Expected rate of return 10 % 10 % Actual return on plan assets 35,900 61,200 Amortization of prior service cost 69,800 50,500 Annual contributions 96,700 81,000 Benefits paid retirees 31,400 54,600 Increase in projected benefit obligation due to changes in actuarial assumptions 86,900 0 Accumulated benefit obligation at December 31 716,500 788,800 Average service life of all employees 20 years Vested benefit obligation at December 31 466,800 (a) Prepare a pension worksheet presenting both years 2020 and 2021 and accompanying computations and amortization of the loss (2021) using the corridor approach. (b) Prepare the journal entries (from the worksheet) to reflect all pension plan transactions and events at December 31 of each year. (c) For 2021, indicate the pension amounts reported in the financial statements.
Blossom Company sponsors a defined benefit pension plan for its employees. The following data relate to the operation of the plan for the years 2020 and 2021. 2020 2021 Projected benefit obligation, January 1 $601,000 Plan assets (fair value and market-related value), January 1 413,800 Pension asset/liability, January 1 187,200 Cr. Prior service cost, January 1 161,600 Service cost 40,200 $59,000 Settlement rate 10 % 10 % Expected
(a) Prepare a pension worksheet presenting both years 2020 and 2021 and accompanying computations
and amortization of the loss (2021) using the corridor approach.
(b) Prepare the
at December 31 of each year.
(c) For 2021, indicate the pension amounts reported in the financial statements.
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