Stars Inc. has a noncontributory defined pension plan for its employees. During 2020, the company had service cost of $108,000, an expected return on plan assets of $16,704, amortization of prior service cost of $3,600, amortization of net pension loss of $4,000, and benefits paid to employees of $72,000. The January 1, 2020, balance in its projected benefit obligation was $349,200. The discount rate is 10%.
Required
Calculate pension expense for 2020.
Calculation of Pension Expense | |
$ | |
Service Cost | 108,000.00 |
Interest cost (10% x $349,200) | 34,920.00 |
Expected return on the plan assets | (16,704.00) |
Amortization of prior service cost | 3,600.00 |
Amortization of net loss | 4,000.00 |
Pension Expense | 133,816.00 |
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