
Gordon Company sponsors a defined benefit
pension plan. The following information related to the pension plan is available for 2012 and 2013.
2012 | 2013 | ||||
Plan assets (fair value), December 31 | $699,000 | $849,000 | |||
Projected benefit obligation, January 1 | 700,000 | 800,000 | |||
Pension asset/liability, January 1 | 140000 | ? | |||
Prior service cost, January 1 | 250,000 | 240,000 | |||
Service cost | 60,000 | 90,000 | |||
Actual and expected return on plan assets | 24,000 | 30,000 | |||
Amortization of prior service cost | 10,000 | 12,000 | |||
Contributions (funding) | 115,000 | 120,000 | |||
Accumulated benefit obligation, December 31 | 500,000 | 550,000 | |||
Interest/settlement rate | 9% | 9% |
Instructions
(a) Compute pension expense for 2012 and 2013.
(b) Prepare the journal entries to record the pension expense and the company’s funding of the pension
plan for both years.
No comments:
Post a Comment