TKE Corporation established a defined benefit pension plan in 2016. TKE has provided the following information for the year ended December 31, 20X1:

Service cost	$	90,000
Interest cost	$	120,000
Actual return on plan assets	$	70,000
Expected return on plan assets	$	80,000
Amortization of prior service costs	$	30,000

If the company contributes $130,000 cash to the pension plan trustee, which one of the following journal entries properly records the payment?

1. DR Pension expense 90,000 DR Pension asset (liability) 40,000 CR Cash 130,000
2. DR Pension expense 120,000 DR Pension asset 10,000 CR Cash 130,000
3. DR Pension expense 130,000 CR Cash 130,000
4. DR Pension expense 160,000 CR Cash 130,000 CR Pension asset (liability) 30,000

Answer rating: 100% (QA)

Service cost Interest cost Expected return on plan ... View the full answer