Exercise 20-1 The following information is available for the pension plan of Ste

Question

Exercise 20-1
The following information is available for the pension plan of Stellar Company for the year 2017.
Actual and expected return on plan assets $ 15,300
Benefits paid to retirees 36,700
Contributions (funding) 87,600
Interest/discount rate 9 %
Prior service cost amortization 7,600
Projected benefit obligation, January 1, 2017 510,000
Service cost 60,500





Compute pension expense for the year 2017.
Pension expense for 2017 $

Exercise 20-1 The following information is available for the pension plan of Stellar Company for the year 2017. 15,300 36,700 87,600 Actual and expected return on plan assets Benefits paid to retirees Contributions (funding) Interest/discount rate Prior service cost amortization Projected benefit obligation, January 1, 2017 Service cost 9% 7,600 510,000 60,500 Compute pension expense for the year 2017. Pension expense for 2017

Explanation / Answer

Computation of pension expense:

Service cost $60,500 Interest cost ($510,000 × 9%) 45,900 Actual (expected) return on plan assets (15,300) Unrecognized prior service cost amortization 7,600 Pension expense for 2017 $98,700

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