Question

Pension data for Barry Financial Services Inc. include the following: ($ in 000s) Discount rate, 7% Expected return on plan assets, 10% Actual return on plan assets, 9% Service cost, 2018 January 1, 2018: Projected benefit obligation Accumulated benefit obligation Plan assets (fair value) Prior service cost-A0CI (2018 amortization, $40) Net gain-A0CI (2018 amortization, $8) There were no changes in actuarial assumptions. December 31, 2018: Cash contributions to pension fund, December 31, 2018 Benefit payments to retirees, December 31, 2018 $ 400 2,750 2,450 2,850 370 420 335 360 Required: 1. Determine pension expense for 2018 2. Prepare the journal entries to record pension expense, gains and losses (if any), funding, and retiree benefits for 2018

Answer 1

is Ans. as follows 1. Pension Expense The 400 192.5 -285 service cost Interest Cost 2750x7% Expected return on Plan assets 2850 X (10%-90) Amortization of Prior service cost. Amortization of net hain pension Expense 40 - 8 339.5 Credit Date poorbculars bebit Pension Expense 339.5 Plan assets 2850x 10% 285 Net Gain - Aoca plan senice Cost - AOCI PBO (4004192.5) (Berng t zecord pension expense) 40 5925 28.5 other comprehensive income To Plan assets (To record loss) 235 plan Assets $ 335 To $335 cash record (to contributions to Pension fond) PBO $360 Plan Assets to record payment $360 to retirees)