Preparing and Recording Pension Entries and Preparing Pension Worksheet The following data relate to a pension plan for ISPN Inc. Account Balances Projected Benefit Obligation Plan Assets Accumulated OCI-Pension Gain/Loss Accumulated OCIPrior Service Cost Jan. 1, 2020 $30,000 Cr. 30,000 Dr. 5,000 Cr. 8,000 Dr. 2020 Activity Service cost Contributions Prior service cost amortization Expected return on plan assets Actual return on plan assets $7,000 9,000 1,000 2,000 3,000 Journal Entries Financial Statement Presentation Pension Worksheet a. Provide the entries related to the defined pension plan for 2020 assuming a discount rate of 8%. Amortize Accumulated OCIPension Gain/Loss using the straight-line method over 15 years. Note: List multiple debits (when applicable) in alphabetical order and list multiple credits (when applicable) in alphabetical order. Note: Round your answers to the nearest whole dollar. Account Name Dr. Cr. Date Dec. 31, 2020 To record pension expense Dec 31, 2020 To record deferral of unexpected gain on plan assets . Dec 31, 2020 To record plans funding Preparing and Recording Pension Entries and Preparing Pension Worksheet The following data relate to a pension plan for ISPN Inc. Account Balances Jan. 1, 2020 Projected Benefit Obligation $30,000 Cr. Plan Assets 30,000 Dr. Accumulated OCI-Pension Gain/Loss 5,000 Cr. Accumulated OCI-Prior Service Cost 8,000 Dr. 2020 $7,000 Activity Service cost Contributions Prior service cost amortization Expected return on plan assets Actual return on plan assets 9,000 1,000 2,000 3,000 Journal Entries Financial Statement Presentation Pension Worksheet b. Assuming pension expenses are not capitalized as part of inventory or other assets, indicate the effect on the income statement for the year ended December 31, 2020. Note: Do not use a negative sign with your answers. Note: Round your answers to the nearest whole dollar. Income Statement For the Year Ended December 31, 2020 Operating expenses Nonoperating expenses $ C. Indicate the changes in balance sheet accounts between January 1 and December 31, 2020. Assets Plan assets increase $ Cash decrease Assets net increase $ Liablities PBO increase $ Equity Retained earnings decrease (pension expense) $ AOCI increase Equity net decrease $ Preparing and Recording Pension Entries and Preparing Pension Worksheet The following data relate to a pension plan for ISPN Inc. Account Balances Jan. 1, 2020 Projected Benefit Obligation $30,000 Cr. Plan Assets 30,000 Dr. Accumulated OCI-Pension Gain/Loss 5,000 Cr. Accumulated OCI-Prior Service Cost 8,000 Dr. Activity 2020 Service cost $7,000 Contributions 9,000 Prior service cost amortization 1,000 Expected return on plan assets 2,000 Actual return on plan assets 3,000 Journal Entries Financial Statement Presentation Pension Worksheet d. Create a worksheet to summarize the pension data at the end of 2020. Note: Round your answers to the nearest whole dollar. Reported Net in Financial Statements Reported on Balance Sheet Accumulated OCI Plan Net Pension Prior Pension Assets PBO Asset/Liability Service Cost Gain/Loss $ $ $ $ $ Reported in Comprehensive Income OCI Pension Prior Pension Expense Service Cost Gain/Loss Cash Outflow $ $ $ Balance, January 1, 2020 Service cost Interest cost Expected return Unexpected gain on plan assets Prior service cost amortization Pension gain/loss amortization Contributions to fund Balance, December 31, 2020 $ $ $ $ $ $ $ $
