Lightfoot Industries sponsors a defined-benefit pension plan for its employees. As of January 1, 2020, the pension
Question:
Lightfoot Industries sponsors a defined-benefit pension plan for its employees. As of January 1, 2020, the pension reported a Projected Benefit Obligation of $1,125,000 and a fair value of Plan Assets of $900,000.
Lightfoot also reports the following as of January 1, 2020:
Dr (Cr) | ||
Net pension asset/liability | $ (225,000) | |
Accumulated other comprehensive income (AOCI) | ||
Prior service cost | $ 60,000 | |
Gains/Losses | $ - | |
Additionally, the following information is available for 2020:
Service cost | $ 210,000 |
Actual return of plan assets | $ 70,000 |
Amortization of prior service costs | $ 6,000 |
Benefits paid to retirees | $ 315,000 |
Contributions to the plan | $ 150,000 |
Discount rate | 9.0% |
Expected return rate | 7.0% |
Determine pension expense for 2020
Prepare the 2020 journal entry to reflect pension activity for Lightfoot Industries
What is the Net Pension Asset/Liability at the end of 2020?
Expert Answer:
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