Reference no: EM132935601
Question - Eckert, Inc. offers a noncontributory, defined-benefit pension plan to its employees. The average remaining service life of employees is 10 years. An actuarial consulting firm has provided the following information related to the plan (no benefits were paid during the year):
On December 31, 2023, the following information was provided concerning the pension plan's operations.
Employer's contribution at end of year $1,600,000
Service cost 600,000
Projected benefit obligation-beginning of the year 6,043,200
Plan assets (at fair value=market related value)-beginning of the year 4,000,000
Expected return on plan assets 9%
Settlement rate 8%
Actual return on plan assets $360,000
Plan amendment retroactive to January 1st 400,000
Required -
(a) Compute the pension expense recognized in 2023. Assume the prior service cost is amortized over the average remaining service life of the employees.
(b) Prepare the journal entries to reflect accounting for the company's pension plan for the year ended December 31, 2023.
(c) Indicate the amounts that are reported on the income statement and the balance sheet for 2023.