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Best Home Construction Corporation has a defined benefit pension plan. The 2019 data for this plan appear below. At 12/31/19: ($ in thousands) PBO ($3,765,000)

Best Home Construction Corporation has a defined benefit pension plan. The 2019 data for this plan appear below.

At 12/31/19: ($ in thousands)

PBO ($3,765,000)

ABO ($2,447,000)

Plan Assets $3,600,000

Pension Asset/(Liability) ($ 165,000)

For 2020:($ in thousands)

Amendment at 1/1/2020 - Prior Service cost $450,000

Actual return on plan assets $150,000

Service cost $207,000

Cash contributions $191,250

Retiree benefits paid $182,000

Settlement rate for liability 6%

Expected return on plan assets 4%

The average remaining service life of the active employee group is 15 years in 2020.

Required:

  1. Complete the pension worksheet
  2. Prepare the journal entry to record the plan amendment at 1/1/2020.
  3. Prepare the journal entry to record 2020 pension expense.

image text in transcribed

Please work and explain the required problems a, b, and c above including journal entry for 2020 pension expense. Thanks

Here's an example of a similar problem:image text in transcribed

Pension Description Expense Balances at 12/31/2019 GENERAL JOURNAL Other Comprehensive Income Memo entry - Pension trust Unrecog Pension PSC (Gain)/Loss Asset/(Liab) PBO Plan Assets (165,000) (3,765,000) 3,600,000 | Cash Journal entry Journal entry Balances at 12/31/2020 Memo Record Pension Worksheet General Journal Entries Other Comprehensive Inc Prior Service Cost Gain/Loss Date Description Pension Expense Cash Pension Asset/ Liability (800) PBO (2,500) Plan Assets 1,700 1/1/2020 Service Cost (400) (250) Interest Expense on PBO 250 (170) Expected ROPA Actual ROPA - Expected ROPA (250) Funding Contributions (700) Benefits paid 200 (350) Unexpected PBO increase Journal Entry 12/31/2020 Balances 480 (700) 120 (680) (3,300) 2620 CHECK BALANCES (3,300) 2,620 difference Actual ROPA - Expected ROPA $170 +$250-420 Pension Required Cash 700 OCI - Vnres gain/loss Pension Description Expense Balances at 12/31/2019 GENERAL JOURNAL Other Comprehensive Income Memo entry - Pension trust Unrecog Pension PSC (Gain)/Loss Asset/(Liab) PBO Plan Assets (165,000) (3,765,000) 3,600,000 | Cash Journal entry Journal entry Balances at 12/31/2020 Memo Record Pension Worksheet General Journal Entries Other Comprehensive Inc Prior Service Cost Gain/Loss Date Description Pension Expense Cash Pension Asset/ Liability (800) PBO (2,500) Plan Assets 1,700 1/1/2020 Service Cost (400) (250) Interest Expense on PBO 250 (170) Expected ROPA Actual ROPA - Expected ROPA (250) Funding Contributions (700) Benefits paid 200 (350) Unexpected PBO increase Journal Entry 12/31/2020 Balances 480 (700) 120 (680) (3,300) 2620 CHECK BALANCES (3,300) 2,620 difference Actual ROPA - Expected ROPA $170 +$250-420 Pension Required Cash 700 OCI - Vnres gain/loss

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