Bikes-R-Us Company

The company sponsors a defined benefit plan for its 200 employees. On January 1, 2020, the companys actuary provided the following information:

Accumulated other comprehensive loss (PSC) $240,000

Pension plan assets (fair value and market-related asset value) 450,000

Accumulated benefit obligation $480,000

Projected benefit obligation $520,000

The average remaining service period for the participating employees is 6 years. All employees are expected to receive benefits under the plan. On December 31, 2020, the actuary calculated that the present value of future benefits earned for employee services rendered in the current year amounted to $62,000; the projected benefit obligation was $620,000; fair value of pension assets was $515,000; the accumulated benefit obligation amounted to $520,000. The expected return on plan assets and the discount dfevrate on the projected benefit obligation were both 6%. The actual return on plan assets is $15,000. The companys current years contribution to the pension plan amounted to $50,000. No benefits were paid during the year.

(a) Determine the components of pension expense that the company would recognize in 2020. (With only one year involved,you need not prepare a worksheet.)

1(b) Prepare the journal entry to record the pension expense and the companys funding of the pension plan in 2020.

(c) Compute the amount of the 2020 increase/decrease in gains or losses and the amount to be amortized in 2020 and 2021.

(d) Indicate the pension amounts reported in the financial statement as of December 31, 2020.