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Kingbird Co. has the following defined benefit pension plan balances on January 1, 2020. Projected benefit obligation Fair value of plan assets $4,623,000 4,623,000
Kingbird Co. has the following defined benefit pension plan balances on January 1, 2020. Projected benefit obligation Fair value of plan assets $4,623,000 4,623,000 The interest (settlement) rate applicable to the plan is 10%. On January 1, 2021, the company amends its pension agreement so that prior service costs of $603,000 are created. Other data related to the pension plan are: 2020 2021 Service cost $149,000 $170,000 Prior service cost amortization 0 90,000 Contributions (funding) to the plan 199,000 184,000 Benefits paid 217,000 277,000 Actual return on plan assets 250,000 346,000 Expected rate of return on assets 6 % 8 % Items Balance, Jan. 1, 2020 Service cost Interest cost Actual return Unexpected loss Contributions Benefits Journal entry for 2020 Annual Pension Expense $ $ Cash $ +A Service Cost +A $ +A Loss AA $ Liability +A $ Obligation A Assets A F +A
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