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The following balances relate to the defined benefit pension plan of Spencer Industries. Unrecognized gain or loss, 1/1/2015 .. -0- Projected benefit obligation, 1/1/2015 $60,000

The following balances relate to the defined benefit pension plan of Spencer Industries.

Unrecognized gain or loss, 1/1/2015 ..

-0-

Projected benefit obligation, 1/1/2015

$60,000

Discount rate .......................

10%

Fair value of plan assets, 1/1/2015..

$24,000

Initial prior service cost value from amendment on 1/1/2007 ...............

$40,000

Unrecognized prior service cost, 1/1/2015 ...........................

$ 8,000

Average remaining service life of employees covered under initial prior service cost grant ..................

10 years

Actuarial loss, 1/1/2015 ............

$12,000

Expected rate of return on plan assets

12%

Average remaining service life used to amortize unrecognized gain or loss ..

12 years

Service cost, 2015 ..................

$12,000

Service cost, 2016 ..................

$14,000

Contribution to plan assets, end of 2015 ........

$16,000

Contribution to plan assets, end of 2016 ........

$20,000

Actual return on plan assets in 2015

$ 1,800

Actual return on plan assets in 2016

$ 2,400

No benefits were paid in either 2015 or 2016.

Required:

Prepare a pension worksheet for 2015 and 2016.

Prepare the required journal entries for 2015 and 2016.

Prepare the funded status reconciliation disclosure.

4. Compute pension expense for 2015 and 2016, assuming minimum amortization is taken.The following balances relate to the defined benefit pension plan of Spencer Industries.

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