Prepare a pension worksheet for the pension plan

Assignment Help Accounting Basics

Reference no: EM131967272

Question 1

On January 1, 2012, Cisco Company had the following defined benefit pension plan balances.

Defined Benefit Obligation $3,000,000

Fair value of Plan Assets $2,300,000

The interest rate applicable to the plan is 8%. On January 1, 2013, the company amended its pension agreement so that past service costs of $370,000 are created.

The following additional data are provided by the actuary.

                                                 2012          2013
Service cost                              260,000     380,000
Contributions                              320,000     350,000
Benefits                                      150,000     200,000
Actual return on plan assets         184,000     250,000

Instructions

a) Prepare a pension worksheet for the pension plan for 2012 and 2013.

b) Prepare the journal entry for pension expense for 2013.

Reference no: EM131967272

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