Question
Question 3 (25 marks) BUS Limited (BUS) sponsors a defined-benefit pension plan for its employees. On 1 January 2022, the following balances are related to
Question 3 (25 marks) BUS Limited (BUS) sponsors a defined-benefit pension plan for its employees. On 1 January 2022, the following balances are related to this plan: Fair value of the plan assets $450,000 Present value of the defined benefit obligation 600,000 Accumulated Other Comprehensive Income 0 As a result of the operation of the plan during 2022, the actuary provided the following additional data at 31 December 2022. Service cost for 2022 $75,000 Actual return on plan assets 45,000 Past service cost, effective 1 January 2022 120,000 Present value of the defined benefit obligation 902,300 Annual contribution to the plan 115,000 Benefits paid to retirees 70,000 Discount rate 8% Each financial year ends on 31 December.
Required:
A. Prepare a pension worksheet for BUS for the year ending 31 December 2022. (21 marks)
B. Prepare the journal entries for the year ending 31 December 2022. (4 marks)
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