Splish Company sponsors a defined benefit pension plan. The following information related to the pension plan is available for 2020 and 2021. 2020 2021 Plan assets (fair value), December 31 $733,950 $891,450 Projected benefit obligation, January 1 735,000 840,000 Pension asset/liability, January 1 147,000 Cr. Prior service cost, January 1 262,500 252,000 Service cost 63,000 94,500 Actual and expected return on plan assets 25,200 31,500 Amortization of prior service cost 10,500 12,600 Contributions (funding) 120,750 126,000 Accumulated benefit obligation, December 31 525,000 577,500 Interest/settlement rate 10 % 10 %

FINANCIAL ACCOUNTING
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Author:Libby
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Chapter1: Financial Statements And Business Decisions
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Compute pension expense for 2020 and 2021.

Pension expense for 2020  
121,800 
Pension expense for 2021    159,600
Splish Company sponsors a defined benefit pension plan. The following information related to the pension plan is available for 2020
and 2021.
2020
2021
Plan assets (fair value), December 31
$733,950
$891,450
Projected benefit obligation, January 1
735,000
840,000
Pension asset/liability, January 1
147,000
Cr.
?
Prior service cost, January 1
262,500
252,000
Service cost
63,000
94,500
Actual and expected return on plan assets
25,200
31,500
Amortization of prior service cost
10,500
12,600
Contributions (funding)
120,750
126,000
Accumulated benefit obligation, December 31
525,000
577,500
Interest/settlement rate
10 %
10 %
Transcribed Image Text:Splish Company sponsors a defined benefit pension plan. The following information related to the pension plan is available for 2020 and 2021. 2020 2021 Plan assets (fair value), December 31 $733,950 $891,450 Projected benefit obligation, January 1 735,000 840,000 Pension asset/liability, January 1 147,000 Cr. ? Prior service cost, January 1 262,500 252,000 Service cost 63,000 94,500 Actual and expected return on plan assets 25,200 31,500 Amortization of prior service cost 10,500 12,600 Contributions (funding) 120,750 126,000 Accumulated benefit obligation, December 31 525,000 577,500 Interest/settlement rate 10 % 10 %
Prepare the journal entries to record the pension expense and the company's funding of the pension plan for both years. (Credit
account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the
account titles and enter O for the amounts.)
Date
Account Titles and Explanation
Debit
Credit
Dec. 31,
Pension Expense
121800
2020
Pension Asset/Liability
Other Comprehensive Income (PSC)
10500
Other Comprehensive Income (G/L)
|
Cash
120750
Dec. 31,
Pension Expense
159600
2021
Pension Asset/Liability
21000
Other Comprehensive Income (PSC)
12600
Cash
126000
Transcribed Image Text:Prepare the journal entries to record the pension expense and the company's funding of the pension plan for both years. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Date Account Titles and Explanation Debit Credit Dec. 31, Pension Expense 121800 2020 Pension Asset/Liability Other Comprehensive Income (PSC) 10500 Other Comprehensive Income (G/L) | Cash 120750 Dec. 31, Pension Expense 159600 2021 Pension Asset/Liability 21000 Other Comprehensive Income (PSC) 12600 Cash 126000
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