Reference no: EM131997542
Question - Pension Worksheet with Reconciliation Schedule
Dade Shutters Inc. sponsors a defined benefit pension plan for its employees. On January 1, 2007, the following balances relate to this plan.
Plan assets $1,650,000
Projected benefit obligation 1,960,000
Pension liability 310,000
Prior service cost 240,000
As a result of the operation of the plan during 2007, the following additional data are provided by the actuary.
Service cost for 2007 $133,000
Settlement rate, 6%
Actual return on plan assets in 2007 108,000
Amortization of prior service cost 24,000
Expected return on plan assets 160,000
Unexpected gain from change in projected benefit obligation, due to change in actuarial predictions 211,000
Contributions in 2007 143,000
Benefits paid retirees in 2007 178,000
Instructions -
(a) Using the data above, compute pension expense for Dade Shutter for the year 2007 by preparing a pension worksheet.
(b) Prepare the journal entry for pension expense for 2007.