Pension data for the Ben Franklin Company include the following for the current calendar year: Discount rate, 8% Expected return on plan assets, 10% Actual return on plan assets, 9% Service cost, $180,000 January 1: PBO $ 1,380,000 ABO 980,000 Plan assets 1,480,000 Amortization of prior service cost 18,000 Amortization of net gain 3,800 December 31: Cash contributions to pension fund $ 218,000 Benefit payments to retirees 238,000 Required: 1. Determine pension expense for the year. 2. Prepare the journal entries to record pension expense and funding for the year.
Pension data for the Ben Franklin Company include the following for the current calendar year: Discount rate, 8% Expected return on plan assets, 10% Actual return on plan assets, 9% Service cost, $180,000 January 1: PBO $ 1,380,000 ABO 980,000 Plan assets 1,480,000 Amortization of prior service cost 18,000 Amortization of net gain 3,800 December 31: Cash contributions to pension fund $ 218,000 Benefit payments to retirees 238,000 Required: 1. Determine pension expense for the year. 2. Prepare the journal entries to record pension expense and funding for the year.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Pension data for the Ben Franklin Company include the following for the current calendar year:
Discount rate, 8%
Expected return on plan assets, 10%
Actual return on plan assets, 9%
Service cost, $180,000
| January 1: | |||
| PBO | $ | 1,380,000 | |
| ABO | 980,000 | ||
| Plan assets | 1,480,000 | ||
| Amortization of prior service cost | 18,000 | ||
| Amortization of net gain | 3,800 | ||
| December 31: | |||
| Cash contributions to pension fund | $ | 218,000 | |
| Benefit payments to retirees | 238,000 | ||
Required:
1. Determine pension expense for the year.
2. Prepare the
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