Gordon Company sponsors a defined benefit pension plan. The following information related to the pension plan is
Question:
Gordon Company sponsors a defined benefit pension plan. The following information related to the pension plan is available for 2020 and 2021.
Instructions
a. Compute pension expense for 2020 and 2021.
b. Prepare the journal entries to record the pension expense and the company?s funding of the pension plan for both years.
2020 2021 Plan assets (fair value), December 31 Projected benefit obligation, January 1 Pension asset/liability, January 1 Prior service cost, January 1 $699,000 $849,000 700,000 800,000 140,000 Cr. 240,000 250,000 Service cost 60,000 90,000 Actual and expected return on plan assets Amortization of prior service cost Contributions (funding) Accumulated benefit obligation, December 31 Interest/settlement rate 24,000 30,000 10,000 12,000 120,000 115,000 500,000 550,000 9% 9%
Step by Step Answer:
a Computation of pension expense b 700000 60000 63000 800000 Although not requ...View the full answer
Intermediate Accounting
ISBN: 978-1119503668
17th edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfiel
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A journal entry is an act of keeping or making records of any transactions either economic or non-economic. Transactions are listed in an accounting journal that shows a company\'s debit and credit balances. The journal entry can consist of several recordings, each of which is either a debit or a credit
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