Prepare any journal entries related to the pension plan that would be needed at December 31, 2020. (Credit account titles areautomatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles andenter O for the amounts.)DateAccount Titles and ExplanationDebitCreditDec. 31,Pension Expense2020Other Comprehensive Income (G/L)19560Cash198000Pension Asset/Liability Pina Co. has the following defined benefit pension plan balances on January 1, 2020.Projected benefit obligation$4,576,000Fair value of plan assets4,576,000The interest (settlement) rate applicable to the plan is 10%. On January 1, 2021, the company amends its pension agreement so thatprior service costs of $604,000 are created. Other data related to the pension plan are:20202021Service cost$149,000$170,000Prior service cost amortization90,000Contributions (funding) to the plan198,000184,000Benefits paid220,000282,000Actual return on plan assets255,000352,000Expected rate of return on assets6 %8 %

Calculation of pension expense for 2020.

Prepare any journal entries related to the pension plan that would be needed at December 31, 2020. (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.)

Prepare any journal entries related to the pension plan that would be needed at December 31, 2020. (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.)

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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Concept explainers

Employee Benefits

In an organization employees are the most important resource and most important asset. They can lead an organization to the sky or can be the reason for unsuccessful of business. Therefore, it is very much important that employees of an organization should be satisfied by the environment of the organization and most importantly with the salary, wages incentives, etc.

Question

100%

Prepare any journal entries related to the pension plan that would be needed at December 31, 2020. (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
2020
Other Comprehensive Income (G/L)
19560
Cash
198000
Pension Asset/Liability

Pina Co. has the following defined benefit pension plan balances on January 1, 2020.
Projected benefit obligation
$4,576,000
Fair value of plan assets
4,576,000
The interest (settlement) rate applicable to the plan is 10%. On January 1, 2021, the company amends its pension agreement so that
prior service costs of $604,000 are created. Other data related to the pension plan are:
2020
2021
Service cost
$149,000
$170,000
Prior service cost amortization
90,000
Contributions (funding) to the plan
198,000
184,000
Benefits paid
220,000
282,000
Actual return on plan assets
255,000
352,000
Expected rate of return on assets
6 %
8 %

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