1. The following amounts are associated with Rockhill Farms Companys pension plan for the year 2020: Plan Assets Jan 1, 2020: $750,000 Projected benefit obligation Jan 1, 2020: 750,000 Settlement rate 5% Service Cost 56,000 Contributions 20,000 Actual and expected returns on assets 50,000 Benefits paid to retirees 62,000 What is the journal entry for the 2020 pension expense? Show your work.
   1. Debit- Pension Expense $43,500, Credit- Pension Liability $23,500, Cash $20,000
   2. Debit- Pension Expense $43,500, Credit- Pension Liability $6,000, Cash $37,500
   3. Debit- Pension Expense $105,500, Credit- Pension Liability $85,500, Cash $20,000
   4. Debit- Pension Expense $105,500, Credit- Pension Liability $69,000, Cash $37,500

b.)

Java Coffee Roasters has the following balances related to its pension on December 31, 2020:

Projected benefit obligation

$960,000

Plan assets at fair value

1,210,000

Accumulated OCI

450,000

What is the appropriate accounting recognition of the pension on the balance sheet? Explain your answer.

a. A pension liability

b. A pension asset

c. Disclosed only

d. No recognition

c.)

Sheridan Company amended its pension plan on January 1, 2020 and granted $450,000 of prior

service costs to its employees. The employees are expected to provide 9,000 service years with 900

service years in 2020. Compute the prior service cost amortization. Show work and explain your answer.

a. $50,000

b. $45,000

c. $9,000

d. $900