(L.O. 2 and 3) On January 1, 2017 Bengston Company amended its pension plan to provide greater benefits to its employees. The amendment to the plan resulted in prior service costs with a present value of $90,000. Also, the following facts relate to the pension plan for 2017

Projected benefit obligation, 12/31/16 $175,000

Plan assets, 12/31/16 171,000 Prior service cost, 1/1/17 90,000 Annual service cost, 2017 18,000

Settlement rate, 2017 12%

Actual return on plan assets 18,500 Employers contribution, 2017 42,000 Benefits paid to retirees, 2017 12,000 Balance in pension asset/liability, 12/31/16 4,000 Amortization of prior service cost using the yearsofservice method 23,800

Instructions:

a. Based upon the information presented above prepare a pension worksheet for Bengston Company for 2017.

b.Record the journal entry to formally recognize the pension expense for 2017.

c.Prepare the reconciliation schedule for December 31, 2017.