Reference no: EM133164766
Question - Spruce-East Advertising, Inc., initiated a defined-benefit pension plan 5 years ago. All prior service costs are for vested employees. The beginning balances for the current year related to the company's pension plan follow:
Beginning plan assets at fair value $8,010
Beginning projected benefit obligation 9,133
Service cost 1,827
Settlement rate 8%
Expected return on plan assets 4%
Actual return on plan assets 570
Contributions for the year 1,060
Benefits paid during the year 900
Amortization of prior service cost 670
Beginning balance of Unamortized prior service cost (AOCI) 2,020
Beginning balance of Unamortized net actuarial gains (AOCI) 3,012
Average remaining service life of employees 5 years
Required -
A. Compute the total pension cost for the year.
B. Determine the ending balances of the plan assets and the projected benefit obligation and indicate the funded status of the plan for the year.
C. Reconcile the ending balance in the accumulated other comprehensive income account with the amounts attributable to unamortized prior service cost and unamortized net actuarial gains/losses.
D. Prepare the journal entry to record the current year's pension cost.