On January 1, 2020, McGee Co. had the following balances: Projected benefit obligation $7,800,000 Fair value of plan assets 7,800,000 Other data related to the pension plan for 2020: Service cost 315,000 Contributions to the plan 459,000 Benefits paid 450,000 Actual return on plan assets 444,000 Settlement rate 9% Expected rate of return 6% Instructions (a) Determine the projected benefit obligation at December 31, 2020. There are no net gains or losses. (b) Determine the fair value of plan assets at December 31, 2020. (c) Calculate pension expense for 2020. (d) Prepare the journal entry to record pension expense and the contributions for 2020.
On January 1, 2020, McGee Co. had the following balances:
Projected benefit obligation $7,800,000
Fair value of plan assets 7,800,000
Other data related to the pension plan for 2020:
Service cost 315,000
Contributions to the plan 459,000
Benefits paid 450,000
Actual return on plan assets 444,000
Settlement rate 9%
Expected
Instructions
(a) Determine the projected benefit obligation at December 31, 2020. There are no
net gains or losses.
(b) Determine the fair value of plan assets at December 31, 2020.
(c) Calculate pension expense for 2020.
(d) Prepare the
2020.
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