Return to the facts of A19-10. Assume instead that this pension plan is sponsored by a private company and ASPE applies.

Data From A19-10

Urban Life Ltd. sponsors a defined benefit pension plan for its employees. It is now the 20X9 fiscal  year. An appropriate interest rate for long-term debt is 6%. Information with respect to the plan is  as follows:

Required:
1. Prepare an entry to record pension expense and an entry to record the contribution to the pension fund for 20X9. Note: The solution to this assignment is based on one calculation of pension expense, followed by one entry for pension expense, rather than a series of entries for separate components.
2. Based on the entries in requirement 1, calculate the SFP net defined benefit liability as of 31 December 20X9, and prove this number based on the closing balances of the defined benefit liability and pension plan assets.

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Fair value of plan assets, 31 December 20X8 Defined benefit obligation, 31 December 20X8 Actual return on plan assets for 20X9 Past service cost from amendment dated 1 January 20X9, liability is reduced because benefits were reduced. Actuarial revaluation dated 31 December 20X9; liability is reduced because of changed mortality assumptions. Funding payment at year-end 20X9 Benefits paid to retirees during 20X9 Current service cost for 20X9 $5,398,000 6,499,000 61,100 (203,200) (603,700) 450,000 105,000 250,400