(Comprehensive 2-Year Worksheet) Mount Co. has the following defined benefit pension plan balances on January 1, 2009.

Projected benefit obligation $4,500,000 Fair value of plan assets 4,500,000 The interest (settlement) rate applicable to the plan is 10%. On January 1, 2010, the company amends its pension agreement so that prior service costs of $600,000 are created. Other data related to the pension plan are:

Instructions

(a) Prepare a pension worksheet for the pension plan in 2009.

(b) Prepare any journal entries related to the pension plan that would be needed at December 31, 2009.

(c) Prepare a pension worksheet for 2010 and any journal entries related to the pension plan as of December 31, 2010.

(d) Indicate the pension-related amounts reported in the 2010 financial statements.

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Service costs Prior service costs amortization Contributions (funding) to the plan Benefits paid Actual return on plan assets Expected rate of return on assets 2009 2010 $150,000 $170,000 -0- 90,000 150,000 184,658 220,000 280,000 252,000 250,000 6% 8%