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Baron Company adopted a defined benefit pension plan on January 1, 2015. The following information pertains to the pension plan for 2016 and 2017: 2016
Baron Company adopted a defined benefit pension plan on January 1, 2015. The following information pertains to the pension plan for 2016 and 2017:
2016 | 2017 | |
Service cost | $120,000 | $130,000 |
Projected benefit obligation (1/1) | 90,000 | 219,000 |
Plan assets (1/1) | 90,000 | 223,000 |
Company contribution (funded 12/31) | 124,000 | 140,000 |
Discount rate | 10% | 10% |
Expected long-term (and actual) rate of return on plan assets | 10% | 10% |
There are no other components of Barons pension expense.
Required:
1. | Compute the amount of Barons pension expense for 2016 and 2017. |
2. | Prepare the journal entries to record the pension expense for 2016 and 2017. |
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