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Question: An entity's retirement benefits plan provides for annual contribution of 2,000,000 to fund held and managed by a third party. The fund is legally separate from the entity and is to be used solely for the retirement pay of employees. the amount to be received by a retiring employee is dependent on the amount of contributions and the investment income earned on those contributions. The third party trustee assumes the obligation of disbursing the funds to retiring employees.
The entity made the following contributions to the fund:
20x1 $ 0
20×2 $ 4,700,000
20x3 $ 1,200,000
Requirements: Provide the entries to record contributions.
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