Item17

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Item 17

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01:01:11

Michigan Consulting Company has a defined benefit pension plan. The following pension-related data were available for the current calendar year:

PBO:
Balance, Jan. 1	$	235,000
Service cost		36,000
Interest cost (5% discount rate)		11,750
Gain from changes in actuarial assumptions in 2021		(4,500	)
Benefits paid to retirees		(15,000	)
Balance, Dec. 31	$	263,250
Plan assets:
Balance, Jan.1	$	245,000
Actual return (expected return was $22,000)		20,000
Contributions		30,000
Benefits paid		(15,000	)
Balance, Dec. 31	$	280,000
ABO, Dec. 31	$	239,500
January 1, 2021, balances:
Prior service costAOCI (amortization $5,075/yr.)		5,075
Net gainAOCI (amortization, if any, over 15 years)		50,750

There were no other relevant data. Required: 1. Calculate the 2021 pension expense. 2. Prepare the 2021 journal entries to record pension expense and funding. (Show separate entries to record Pension expense and contributions to the plan fund) 3. Prepare any journal entries to record any 2021 gains or losses. (Prepare separate entries to record gains/loss on PBO and Plan Assets for 2021).