Determine the total amount of pension expense

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Question: (Amortization of Accumulated OCI Balances) Keeton Company sponsors a defined benefit pension plan for its 600 employees. The company's actuary provided the following information about the plan.

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The average remaining service life per employee is 10.5 years. The service cost component of net periodic pension expense for employee services rendered amounted to $400,000 in 2014 and $475,000 in 2015. The accumulated OCI (PSC) on January 1, 2014, was $1,260,000. No benefits have been paid. Instructions

(Round to the nearest dollar.)

(a) Compute the amount of accumulated OCI (PSC) to be amortized as a component of net periodic pension expense for each of the years 2014 and 2015.

(b) Prepare a schedule which reflects the amount of accumulated OCI (G/L) to be amortized as a component of pension expense for 2014 and 2015.

(c) Determine the total amount of pension expense to be recognized by Keeton Company in 2014 and 2015.

Reference no: EM131593296

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