Latoya Company provides the following selected information related to its defined benefit pension plan for 2015.

Instructions

(a) Compute pension expense and prepare the journal entry to record pension expense and the employer’s contribution to the pension plan in 2015. Preparation of a pension worksheet is not required. Benefits paid in 2015 were $35,000.

(b) Indicate the pension-related amounts that would be reported in the company’s statement of comprehensive income and statement of financial position for 2015.

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Pension asset/liability (January 1) Accumulated benefit obligation (December 31) Actual return on plan assets Contributions (funding) in 2015 Discount (interest) rate Defined benefit obligation (January 1) Service cost $ 25,000 Cr. 400,000 67,500 50,000 10% 700,000 80,000