Melanie Vail Corp. sponsors a defined benefit pension plan for its employees. On January 1, 2010, the following balances relate to this plan.

As a result of the operation of the plan during 2010, the following additional data are provided by the actuary.

(a) Use a computer spreadsheet to prepare a pension worksheet. On the pension worksheet, compute pension expense, pension asset/liability, projected benefit obligation, plan assets, prior service cost, and net gain or loss.

(b) Compute the same items as in (a), assuming that the settlement rate is now 7% and the expected rate of return is 10%.

Prepare the journal entry to record pension expense in 2010.

Indicate the reporting of the 2010 pension amounts in the income statement and balance sheet

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Plan assets Projected benefit obligation Accumulated OCI (PSC) $480,000 625,000 100,000 Dr.