Question 3 Nick Inc. sponsors a defined benefit pension plan. The corporation's actuary provides the following information about the plan. 1/1/2020 12/31/2020 Projected benefit obligation 625,000 Plan assets 550,000 Prior service cost (plan amended) 228,000 Accumulated OCI (G/L)-Dr. 92,500 Settlement & expected return rate 10% Service cost 85,000 Contributions (funding) 120,000 Actual return on plan assets 44,000 Benefits paid to retirees 110,000 Average service life of all covered employees in years 10 Notes: Read carefully and follow strictly so that Bb can grade you correctly! 1. Use comma in numbers, one thousand is 1,000, not 1000. No s sign. No positive or negative sign. 2. If no entry is required, write N/A 3. Only use the following accounts: Cash, Pension expense, OCI-PSC, OCI-G/L, Pension asset/liability 4. Copy account names accurately to receive credits, names are not case sensitive. (a) Compute pension expense for 2019 (1) Service cost [1] (2) Interest cost 12] Account [25] Dr. [26] Account [27] Cr. [28] 1/1/2020 journal entries for receiving the first payment: Account [29] Dr. [30] Account [31] Cr. [32] 12/31/2020 journal entries for interest: Account [33] Dr. [34] Account [35] Cr. [36] 1/1/2021 journal entries for receiving the lease payment: Account [37] Dr. [38] Cr. [40] Account [39] Question 3 Nick Inc. sponsors a defined benefit pension plan. The corporation's actuary provides the following information about the plan. 1/1/2020 12/31/2020 Projected benefit obligation 625,000 Plan assets 550,000 Prior service cost (plan amended) 228,000 Accumulated OCI (G/L)-Dr. 92,500 Settlement & expected return rate 10% Service cost 85,000 Contributions (funding) 120,000 Actual return on plan assets 44,000 Benefits paid to retirees 110,000 Average service life of all covered employees in years 10 Notes: Read carefully and follow strictly so that Bb can grade you correctly! 1. Use comma in numbers, one thousand is 1,000, not 1000. No s sign. No positive or negative sign. 2. If no entry is required, write N/A 3. Only use the following accounts: Cash, Pension expense, OCI-PSC, OCI-G/L, Pension asset/liability 4. Copy account names accurately to receive credits, names are not case sensitive. (a) Compute pension expense for 2019 (1) Service cost [1] (2) Interest cost 12] Account [25] Dr. [26] Account [27] Cr. [28] 1/1/2020 journal entries for receiving the first payment: Account [29] Dr. [30] Account [31] Cr. [32] 12/31/2020 journal entries for interest: Account [33] Dr. [34] Account [35] Cr. [36] 1/1/2021 journal entries for receiving the lease payment: Account [37] Dr. [38] Cr. [40] Account [39]
