Question
Bonita Company sponsors a defined-benefit pension plan for its employees. On 1/1/2021, the following balances were related to this plan. Plan assets (fair value) $1,400,000
Bonita Company sponsors a defined-benefit pension plan for its employees. On 1/1/2021, the following balances were related to this plan.
Plan assets (fair value) $1,400,000 Projected benefit obligation 1,200,000 Accumulated OCI (Prior Service Cost) 300,000 Accumulated OCI Gains 180,000
As a result of the operation of the plan during 2021, the actuary provided the following additional data at December 31, 2021. Service cost for 2021 $260,000 Actual return on plan assets in 2021 120,000 Amortization of prior service cost in 2021 60,000 Contributions in 2021 350,000 Benefits paid retirees in 2021 220,000 Settlement rate 8% Expected rate of return 7% Average remaining service life of active employees 10 years
Instructions (a) Compute pension expense for Maguire Company for the year 2021 by preparing a pension worksheet. (b) Prepare the journal entry for pension expense for 2021.
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