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 2022 and 2023 no benefits were paid in either year.
Instructions
a. Compute pension expense for 2022 and 2023.
b. Prepare the journal entries to record the pension expense and the company’s funding of the pension plan for both years.
2022 2023 Plan assets (fair value), December 31 $699,000 $849,000 Defined benefit obligation, January 1 700,000 800,000 Pension asset/liability, January 1 140,000 Cr. ? Service cost 60,000 90,000 Actual return on plan assets 24,000 30,000 Contributions (funding) 115,000 120,000 Accumulated benefit obligation, December 31 Discount (interest) rate 500,000 550,000 %6 %6
Step by Step Answer:
a Computation of Pension Expense 2022 Service Cost 24000 Interest Cost 849000 x 9 76410 Expe...View the full answer
Intermediate Accounting IFRS
ISBN: 9781119607519
4th Edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield
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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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