Home/ Questions/Pension data for Barry Financial Services Inc. include the following: ($ in 0008) $ 470 Discount...
Next
Answered
lyytutoria
  • 23
Expert
Asked: 2022-04-13T07:40:45+00:00 In:

Pension data for Barry Financial Services Inc. include the following: ($ in 0008) $ 470 Discount…

  • 23

. Advertisement .

..3..

Pension data for Barry Financial Services Inc. include the following:
                                                                                                       ( $ in 000s)
Discount rate, 7%
Expected return on plan assets, 11%
Actual return on plan assets, 10%
Service cost, 2018 $ 470
January 1, 2018:
Projected benefit obligation 3,100
Accumulated benefit obligation 2,800
Plan assets (fair value) 3,200
Prior service cost-AOCI (2018 amortization, $45) 405
Net gain-AOCI (2018 amortization, $12) 490
There were no changes in actuarial assumptions.
December 31, 2018:
Cash contributions to pension fund, December 31, 2018 405
Benefit payments to retirees, December 31, 2018 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).)
♦ Relevant knowledge

. Advertisement .

..4..

Pension expense is the sum which the employer puts into an account that is invested to pay for the retirement benefits for the worker. The employee is paid a set amount following his or her retirement every year at a certain time.

dataexpensepension
Share

1 Answer

  1. Best Answer

    1. Pension expenses = $368

    Explanation;

    Particulars The amount
    Service Cost $470
    Interest Rate $217
    Expected Return on Asset $(352)
    Amortization of Prior Service Charges $45
    Amortization Net Gain $(12)
    Pension expenses $368

    2. General Journal

    Record Pension Expense

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

    Record Asset Gains or Losses

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

    Keep track of 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
    • 17

Leave an answer

You must login to add an answer.

Need An Account,