On January 1, 20x4, the day a company was formed, a defined benefit pension plan for...

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On January 1, 20x4, the day a company was formed, a defined benefit pension plan for all employees was initiated. The plan assets at January 1, 20x5, held by a trustee, amounted to $340,000. Data for the current year, 20x5, is as follows: Current service cost for 20x5 $220,000 Payments to pension plan (was debited to the pension liability account) Actual return on plan assets Balance in defined benefit plan, December 31, 20x5 per actuary Yield on high quality corporate bonds 300,000 15,000 730,000 5% The unadjusted trial balance as at December 31, 20x5 shows a debit balance of $95,000 in the Pension Liability account. The service component of pension expense should be debited to administrative expenses. Required – Prepare one adjusting journal entry related to this pension plan at December 31, 20x5. On January 1, 20x4, the day a company was formed, a defined benefit pension plan for all employees was initiated. The plan assets at January 1, 20x5, held by a trustee, amounted to $340,000. Data for the current year, 20x5, is as follows: Current service cost for 20x5 $220,000 Payments to pension plan (was debited to the pension liability account) Actual return on plan assets Balance in defined benefit plan, December 31, 20x5 per actuary Yield on high quality corporate bonds 300,000 15,000 730,000 5% The unadjusted trial balance as at December 31, 20x5 shows a debit balance of $95,000 in the Pension Liability account. The service component of pension expense should be debited to administrative expenses. Required – Prepare one adjusting journal entry related to this pension plan at December 31, 20x5.

Answer rating: 100% (QA)

Pension Expenses 220000 Journal Entry of Pension Plan December 312015 Projected Benefit Oblig... View the full answer