Blossom Corp. sponsors a defined benefit pension plan for its employees. On January 1, 2020, the following balances related to this plan. Plan assets (market-related value) $480,000 Projected benefit obligation 650,000 Pension asset/liability 170,000 Cr. Prior service cost 80,000 Net gain or loss (debit) 85,000 As a result of the operation of the plan during 2020, the actuary provided the following additional data for 2020. Service cost $99,000 Settlement rate, 9%; expected return rate, 10% Actual return on plan assets 42,000 Amortization of prior service cost 25,000 Contributions 124,000 Benefits paid retirees 82,000 Average remaining service life of active employees 10 years Using the preceding data, compute pension expense for Blossom Corp. for the year 2020 by preparing a pension worksheet that shows the journal entry for pension expense
Blossom Corp. sponsors a defined benefit pension plan for its employees. On January 1, 2020, the following balances related to this plan. Plan assets (market-related value) $480,000 Projected benefit obligation 650,000 Pension asset/liability 170,000 Cr. Prior service cost 80,000 Net gain or loss (debit) 85,000 As a result of the operation of the plan during 2020, the actuary provided the following additional data for 2020. Service cost $99,000 Settlement rate, 9%; expected return rate, 10% Actual return on plan assets 42,000 Amortization of prior service cost 25,000 Contributions 124,000 Benefits paid retirees 82,000 Average remaining service life of active employees 10 years Using the preceding data, compute pension expense for Blossom Corp. for the year 2020 by preparing a pension worksheet that shows the journal entry for pension expense
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Blossom Corp. sponsors a defined benefit pension plan for its employees. On January 1, 2020, the following balances related to this plan.
| Plan assets (market-related value) | $480,000 | ||
| Projected benefit obligation | 650,000 | ||
| Pension asset/liability | 170,000 | Cr. | |
| Prior service cost | 80,000 | ||
| Net gain or loss (debit) | 85,000 |
As a result of the operation of the plan during 2020, the actuary provided the following additional data for 2020.
| Service cost | $99,000 | ||
| Settlement |
|||
| Actual return on plan assets | 42,000 | ||
| Amortization of prior service cost | 25,000 | ||
| Contributions | 124,000 | ||
| Benefits paid retirees | 82,000 | ||
| Average remaining service life of active employees | 10 | years |
Using the preceding data, compute pension expense for Blossom Corp. for the year 2020 by preparing a pension worksheet that shows the
PICTURE BELOW FOR REFERENCE:
Transcribed Image Text:BLOSSOM CORP.
Pension Worksheet-2020
General Journal Entries
OCI-Prior
Service Cost
Memo Record
Projected Benefit
Obligation
OCI- Gain/
Penison Asset/
Liability
Annual Pension
Plan
Items
Expense
Cash
Loss
Assets
Balance, Jan. 1, 2020
Service cost
Interest cost
Actual return
Unexpected loss
Amortization of PSC
Amortization of loss
Contributions
Benefits
Journal entry for 2020
Accumulated OCI, Dec. 31, 2019
Balance, Dec. 31, 2020
Use the market-related asset value to compute the expected return and for corridor amortization.
Expected return
24
Corridor amortization
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