Question
Burrito Corporation has a defined benefit pension plan. Burrito received the following information for the current...
Burrito Corporation has a defined benefit pension plan. Burrito
received the following information for the current calendar
year:
| Projected benefit obligation | ||||
| Balance, January 1 | $ | 157,000,000 | ||
| Service cost | 28,500,000 | |||
| Interest cost | 15,700,000 | |||
| Benefits paid | (15,500,000 | ) | ||
| Balance, December 31 | $ | 185,700,000 | ||
| Plan assets | ||||
| Balance, January 1 | $ | 93,500,000 | ||
| Actual return on plan assets | 11,350,000 | |||
| Contribution | 26,500,000 | |||
| Benefits paid | (15,500,000 | ) | ||
| Balance, December 31 | $ | 115,850,000 | ||
The expected long-term return on plan assets is 10%. There were no
other relevant data for the year.
Required:
1. Determine Burrito's pension expense for the
year.
2. Prepare the journal entries to record the
pension expense and funding for the year.
Homework Answers
Answer #1
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