Compute pension expense for van persie corp for the year

Reference no: EM13391560

Van Persie Corp. sponsors a defined-benefit pension plan for its employees. The following balances related to the plan exist on December 31, 2009.

Plan assets (market value) $450,000

Projected benefit obligation 600,000

Pension asset/liability 150,000 Cr.

Van Persie amends the pension plan, effective 1/1/2010, and the actuary informs Van Persie that the Prior Service Cost associated with the amendment equals $90,000.

As a result of the operation of the plan during 2010, the actuary provided the following additional data on December 31, 2010.

Service cost for 2010 $ 75,000Actual return on plan assets in 2010 45,000Amortization of prior service cost 20,000Contributions in 2010 115,000Benefits paid retirees in 2010 70,000Settlement rate 7%Expected return rate 8%

Instructions

(a) Compute pension expense for Van Persie Corp. for the year 2010 by preparing the attached pension worksheet.

(b) Prepare the journal entry for pension expense.

Reference no: EM13391560

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