Pension data for the Jones 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, $200,000 January 1: PBO $1,400,000 ABO $1,000,000 Plan assets $1,500,000 Amort of prior service cost $20,000 Amort of net gaint $4,000 December 31: Cash contributions to pension funds $220,000 Benefit payments to retirees $240,000 Required: 1. Determine the pension expense for the year. 2. Prepare the journal entries to record: 1) Pension expense 2) Contribution 3) Benefit payment 4) Any gain or loss

Pension data for the Jones 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, $200,000 January 1: PBO $1,400,000 ABO $1,000,000 Plan assets $1,500,000 Amort of prior service cost $20,000 Amort of net gaint $4,000 December 31: Cash contributions to pension funds $220,000 Benefit payments to retirees $240,000 Required: 1. Determine the pension expense for the year. 2. Prepare the journal entries to record: 1) Pension expense 2) Contribution 3) Benefit payment 4) Any gain or loss

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Brooks Co. had pension plan assets and PBO of $150,000 on 1/1/24. Service cost for the year was $30,000. It contributed $28,000 during the year and paid benefits of $20,000. The interest rate was 10%. The actual return was $14,000. Compute pension expense. Show computations'
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II. Pension data for the Phoenix 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, $200,000 January 1: PBO ABO Plan assets Amortization of prior service cost Amortization of net gain December 31: Cash contributions to pension fund Benefit payments to retirees $1,400,000 1,000,000 1,500,000 20,000 4,000 $220,000 240,000 a) Determine pension expense for the year. b) Prepare the journal entries to record pension expenses and funding for the year.
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