Question

ABC Corporation has provided the following information regarding their defined benefit pension plan for the year 2018:

Current service cost $ 235,000
Contribution to the plan 262,500
Past service cost, effective December 31, 2018 50,000
Actual return on plan assets 160,000
Benefits paid 100,000
Net defined benefit liability at January 1, 2018 400,000
Plan assets at January 1, 2018 1,600,000
Defined benefit obligation at January 1, 2018 2,000,000
Interest/discount rate on the DBO and plan assets 10%

Required:

1) Prepare all pension journal entries recorded by ABC in 2018 **Show a detailed breakdown of calculation**
2) What pension amount will appear on ABC's statement of financial position at December 31, 2018?  **Show a detailed breakdown of calculation**

Answer 1

So Q O Plan assets at anuay1,2018 6o0oo0 Actuol etusn on Pan assets 962500 Less: Benefts Paid loooo0 Plon asset endirg bolance 922S00 23 S00O 20o d00 EXfected aetunin onf an assets -600oO Pension fense T1S000 Scanned with CamScanner