he following defined pension data of Rydell Corp. apply to the year 2014. For 20

Question

he following defined pension data of Rydell Corp. apply to the year 2014.

For 2014, prepare a pension worksheet for Rydell Corp. that shows the journal entry for pension expense and the year-end balances in the related pension accounts.

Projected benefit obligation, 1/1/14 (before amendment) $564,000 Plan assets, 1/1/14 548,900 Pension liability 15,100 On January 1, 2014, Rydell Corp., through plan amendment,
   grants prior service benefits having a present value of 128,900 Settlement rate 10 % Service cost 60,000 Contributions (funding) 74,200 Actual (expected) return on plan assets 59,900 Benefits paid to retirees 47,900 Prior service cost amortization for 2014 20,200

Explanation / Answer

General Journal Entries

Annual

Pension

Expense

ANNUAL JOURNAL ENTRY:

Dr. Pension Expense                  89,590

Dr. Other Comprehensive Income (PSC)    108,700

   Cr. Pension Asset/Liability                         124,090

              Cr. Cash 74,200

Item Dr./(Cr.)

Annual

Pension

Expense

Cash OCI Pension Asstes Liability BOY (15,100) Prior service cost 128,900 BOY adjusted 128,900 (15,100) Amortize prior service cost 20,200 (20,200) Annual service cost 60,000 Interest Cost 69,290 Actual return (59,900) Contributions/ Funding (74,200) 89,590 (74200) 108,700 Prepaid/ accrued (PLUG) (124,090) ENDING PENS. ASSET/ LIAB (139,190

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