Problem II: The following defined pension data of Tommy Corporation apply to the year 2017.

PBO, January 1, 2017 (before amendment)	6,500,000
Plan assets, January 1, 2017	6,280,000
On January 1, 2017, through plan amendment,
prior service benefits granted having a PV of	525,000
Settlement & expected return rate	8%
Service cost	425,000
Contributions (funding)	535,000
Actual return on plan assets	389,000
Benefits paid to retirees	511,000
Average service life of all covered employees in years	15

INSTRUCTIONS:

1. For 2017, prepare a pension worksheet that shows the journal entry for pension expense and the year-end balances in the related pension accounts.
2. Prepare the journal entry for pension expense for 2017.