The memorandum records of Red Ribbon Trading Corporation on January 1, 2018 show the following:

                Defined Benefit Obligation                                          P3, 000,000

                Fair Value of Plan Assets                                               P2, 600,000

The following information for 2016 is also provided:

                2018 service cost                                                              P1, 000,000

                Discount rate                                                     10%

                Actual return on plan assets                        640,000

                Benefits paid                                                     600,000

                Contributions made                                        2,000,000

                Past service cost                                                               800,000

The benefit obligation as measured by the actuary at December 31, 2016 has a present value of P11, 050,000.

Requirement:

1. Journal Entries to record the funding and the retirement liability/asset
2. Balance of the defined benefit asset or liability as of December 31, 2018

Reconciliation of the balance determined in C.

Answer rating: 100% (QA)

Year 2018 1 Pension Expense 1040000 2 Journal entry Account title Explaination 2018 Debit Credit Ann... View the full answer