Defined Benefit Plan

In the Excel spreadsheet, see the tab labelled “Defined Benefit Plan” for calculations and requirements for reconciling the pension amounts.

NOTE – for 2021, the payment and expense have not been recorded on the trial balance.

 

For the defined benefit plan - assume the following: Past service cost (end of year adjustment) Fair Value of Plan assets, beg of year DBO, beginning of year Current Service cost Interest Rate on DBO and Plan Assets Actual Earnings on Plan Assets Employer Contribution for the year Benefits Paid to Retirees Required: a) calculate the plan assets at the end of the year b) calculate the DBO at the end of the year 36,900 106,500 115,600 27,400 8% 8,520 12,850 15,600 c) calculate the funded status at the end of the year d) calculate the pension expense for the year. NOTE - prepare the pension worksheet for grading purposes. Pension Worksheet