Mac Company has a noncontributory defined benefit pension plan, with the following data available.

Required

a. Provide the computation for interest cost assuming a discount rate of \(8 \%\).

b. Compute net pension expense. Assume that prior service cost will be amortized over a 10 -year average remaining service period.

c. Provide the 2020 entries for Mac Company related to the defined benefit pension plan.

d. Provide the same entries in (c) assuming cash funding from the employer of \(\$ 35,500\) and no other changes.

e. Determine the plans' fund balance for \((c)\) and (d), at December 31, 2020.

f. Create a worksheet to summarize the pension data at the end of 2020 based upon part (c).

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Account Balances Jan. 1, 2020 Activity 2020 PBO balance, before PSC adjustment... $45,000 Cr. Service cost $32,500 Prior service cost (due to plan Pension benefits paid. 0 amendment on Jan. 1, 2020) Plan Asset balance.. 5,000 Dr. Actual and expected return on 52,500 Dr. plan assets 2,500 Cash funding (contributions). 25,000 Pension benefits paid to retirees 0