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Question 1 Water Inc. has the following balances at 1/1/10 that relate to its defined-benefit pension plan: Plan Assets at Fair Value $800,000 Projected Benefit Obligation 1,000,000 Accumulated OCI (PSC) 140,000 During 2010, the following additional data is available: Service Cost for 2010 $80,000 Settlement rate 15% Actual return on plan assets in 2010 55,000 Amortization of prior service cost 14,000 Expected return on plan assets 10% Unexpected gain from change in projected benefit obligation, due to change in actuarial predictions 50,000 Contributions in 2010 95,000 Benefits paid to retirees in 2010 45,000 Required: a) Compute pension expense for the year 2010 (35 points) b) Prepare the necessary journal entries at year end 2010. (25 points) Question 2 George Incorporated has the following balances as of the end of each year: Year PBO Plan Assets at Fair Value 2010 $1,700,000 $1,900,000 2011 2,300,000 2,000,000 . 2012 1,900,000 2,100,000 At the end of 2010 there is also a $300,000 balance in Accumulated OCI for unrecognized gains. The average remaining service life per employee in 2011 and 2012 is 20 years. The net gain or loss that occurred during each year is as follows: Year Gain (Loss) 2010 $(340,000) 2011 410,000 2012 (370,000) Required: Compute the net gain/loss that is amortized in each of the following 2 years:. a) 2011 (20 points) b) 2012 (20 points)