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Prepare the journal entries to record pension expense

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Question - The following information relates to the defined benefit pension plan for Stark Ltd. for 2020. The corporation uses ASPE.

Current service cost $348,000

Contributions 321,000

Actuarial loss 10,000

Expected & actual return on plan assets 8%

Fair value of plan assets, Jan 1 225,000

Defined benefit obligation, Jan 1 367,000

Interest rate for obligation 9%

Required -

1. Calculate the pension expense to be reported for 2020.

2. Prepare the journal entries to record pension expense and the employer's contributions for 2020.

3. What is the pension expense if the company uses IFRS?

4. Explain briefly in own words the difference between defined benefit and defined contribution plans from the employer perspective.

Reference no: EM132611256

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