Buhl Corp. sponsors a defined benefit pension plan for its employees. On January 1, 2020, the following
Question:
Buhl Corp. sponsors a defined benefit pension plan for its employees. On January 1, 2020, the following balances relate to this plan.
Plan assets....................................................$480,000
Defined benefit obligation............................600,000
Pension asset/liability....................................120,000
As a result of the operation of the plan during 2020, the following additional data are provided by the actuary.
Service cost for 2020........................................................................$90,000
Discount rate, 6%
Actual return on plan assets in 2020...............................................55,000
Unexpected loss from change in defined benefit obligation,
due to change in actuarial predictions............................................76,000
Contributions in 2020........................................................................99,000
Benefits paid retirees in 2020...........................................................85,000
Instructions
a. Using the data above, compute pension expense for Buhl Corp. for the year 2020 by preparing a pension worksheet.
b. Prepare the journal entry for pension expense for 2020.
Step by Step Answer:
Intermediate Accounting
ISBN: 978-1119503668
17th edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfiel