On January 2, 2012 the following balances relate to this plan:
Plan Assets $480,000
Projected benefit obligations $600,000
Accumulated OCI From Prior Service Cost $100,000
As a result of the operation of the plan during 2012, the following data are provided by the actuary.
Service Cost 125,000
Settlement rate 10%
Actual Return on plan assets in 2012 55,000
Amortization of prior service cost 19,000
Contributions 2012 99,000
Benefits paid to retirees in 2012 85,000
Required:
a. Pension Worksheet for 2012
| Particular | Annual Pension Expense | Cash | Plan asset/Liability | OCI-Prior Service Cost | OCI - Gain or loss | Projected Obligations | Plan assets |
|---|---|---|---|---|---|---|---|
| Opening Balance | $ (120,000) | $ 100,000 | $ (600,000) | $ 480,000 | |||
| Service Cost | $ 125,000 | $ (125,000) | |||||
| Interest Expense | $ 60,000 | $ (60,000) | |||||
| Actual Return | $ (55,000) | $ 55,000 | |||||
| Amortisation of Prior service cost | $ 19,000 | $ (19,000) | |||||
| Contributions | $ (99,000) | $ 99,000 | |||||
| Benefits Paid | $ 85,000 | $ (85,000) | |||||
| $ (31,000) | |||||||
| Total | $ 149,000 | $ (99,000) | $ (151,000) | $ 81,000 | $ (700,000) | $ 549,000 |
b. Journal Entry to record pension activity
| Pension Expense | $ 149,000 | |
| Cash | $ 99,000 | |
| OCI --Prior Service Cost | $ 19,000 | |
| Plan assets /Liabilities | $ 31,000 | |
c.
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