I need an answer to the attached question before 8am if possible.
I need an answer to the attached question before 8am if possible.
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On January 1, 2013, Laura’s Living Company has the following defined benefit pension plan balances.
Projected benefit
obligation
$5,700,000
Fair value of plan
assets
7,200,000
The interest (settlement) rate applicable to the plan is 10%. On January 1, 2014, the company amends its
pension agreement so that service costs of $350,000 are created. Other data related to the pension plan
are as follows.
2013
2014
Service costs
$150,000
$165,000
Prior service costs
amortization
$0
$63,000
Contributions
(funding) to the
plan
$168,000
$194,000
Benefits paid
$190,000
$220,000
Actual return on
plan assets
$576,000
$498,000
Expected rate of
return on assets
8%
7%
Required:
(a) Prepare a pension worksheet for the pension plan for 2013 and 2014.
(b) For 2014, prepare the journal entry to record pension-related amounts.
