Question

The following information is available for the pension plan of Tyson Company for the year 2020.

Actual and expected return on plan assets		$ 14,300
Benefits paid to retirees		41,900
Contributions (funding)		96,100
Interest/discount rate		10	%
Prior service cost amortization		8,800
Projected benefit obligation, January 1, 2020		529,000
Service cost		58,800

Compute pension expense for the year 2020.

Pension expense for 2020

$enter pension expense for 2017 in dollars

Prepare the journal entry to record pension expense and the employer’s contribution to the pension plan in 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 0 for the amounts.)

Account Titles and Explanation	Debit	Credit
enter an account title	enter a debit amount	enter a credit amount
enter an account title	enter a debit amount	enter a credit amount
enter an account title	enter a debit amount	enter a credit amount
enter an account title	enter a debit amount	enter a credit amount

These are the accounts that can be used:

• Accumulated Depreciation
• Accumulated Other Comprehensive Income
• Actuarial Loss on Defined Benefit Plan
• Cash
• Common Stock
• Cost of Goods Sold
• Depreciation Expense
• Interest Expense
• Inventory
• Notes Payable
• Other Comprehensive Income (G/L)
• Other Comprehensive Income (PSC)
• Pension Asset/Liability
• Pension Expense
• Plant and Equipment
• Postretirement Asset/Liability
• Postretirement Expense
• Retained Earnings
• Salary Expense
• Sales

Answer 1

Answer :

Computation of pension expense

Service cost	$58,880
Interest cost ($529,000*10%)	$52,900
Actual (Expected)return on plan assets	($14,300)
Unrecognised prior service cost amortisation	$8,800
Pension Expenses for 2020	$106,200

Journal entry to record pension expense and employer's contribution to the pension plan

Account Title	Debit	Credit
Pension Expense	$106,200	-
To Cash	-	$96,100
To Pension Asset / Liability	-	$1,300
To Other comprehensive income (PSC)	-	$8,800
(TO Record pension expense and the employer's contribution to the pension plan for 2020)	-	-

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