Exercise 20-11

Concord Company sponsors a defined benefit pension plan for its employees. The following data relate to the operation of the plan for the year 2017 in which no benefits were paid.

1. The actuarial present value of future benefits earned by employees for services rendered in 2017 amounted to $55,400.

2. The companys funding policy requires a contribution to the pension trustee amounting to $134,684 for 2017.

3. As of January 1, 2017, the company had a projected benefit obligation of $899,800, an accumulated benefit obligation of $793,400, and a debit balance of $403,800 in accumulated OCI (PSC). The fair value of pension plan assets amounted to $600,600 at the beginning of the year. The actual and expected return on plan assets was $54,400. The settlement rate was 8%. No gains or losses occurred in 2017 and no benefits were paid.

4. Amortization of prior service cost was $50,300 in 2017. Amortization of net gain or loss was not required in 2017.

Determine the amounts of the components of pension expense that should be recognized by the company in 2017.

Prepare the journal entry or entries to record pension expense and the employers contribution to the pension trustee in 2017.

Indicate the pension-related amounts that would be reported on the income statement and the balance sheet for Concord Company for the year 2017.