Question

Pension data for Barry Financial Services Inc. include the following: ($ in 0008) $ 470 Discount rate, 78 Expected return on plan assets, 116 Actual return on plan assets, 108 Service cost, 2018 January 1, 2018: Projected benefit obligation Accumulated benefit obligation Plan assets (fair value) Prior service cost-AOCI (2018 amortization, $45) Net gain-AOCI (2018 amortization, $12) 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 3,100 2,800 3,200 405 490 405 430 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. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Determine pension expense for 2018. (Amounts to be deducted should be indicated with a minus sign. Enter your answers in thousands rounded to 1 decimal place (i.e., 5,500 should be entered as 5.5).) Pension Expense

Answer 1

1. Pension Expense = $368

Explanation;

Particulars	Amount
Service Cost	$470
Interest Cost	$217
Expected Return on Asset	$(352)
Amortization of Prior Service Cost	$45
Amortization of Net Gain	$(12)
Pension Expense	$368

2. General Journal

Record Pension Expense

Sl. No	Account Title and Explanation	Debit	Credit
1	Pension Expense	$368
	Plan Asset ( Expected Plan Asset)	$352
	Net Gain - AOCI	$12
	Prior Service Cost - OCI		$45
	PBO ($470+$217)		$687

Record Gain or Loss On Asset

Sl. No	Account Title and Explanation	Debit	Credit
2	Loss OCI	$32
	Plan Asset		$32

Record the Funding

Sl. No	Account Title and Explanation	Debit	Credit
3	Plan Asset	$405
	Cash		$405

Record Retaire Benefit

Sl.No	Account Title and Explanation	Debit	Credit
4	Projected Benefit Obligation	$430
	Plan Asset		$430