Reference no: EM132604930

Question - GHS provides a defined contribution pension plan for its employees. The agreement includes a mandatory contribution by GHS for all employees, and a matching requirement for employees who contribute their own money to the plan. Under the terms of the agreement, GHS's mandatory contribution to the pension trust is 6% of the employees qualifying earnings. The matching provision permits employees to contribute a maximum of 4% of their earnings to the plan as well. GHS must contribute an additional $0.50 to the plan for every $1.00 the employee contributes. The maximum required contribution by GHS is thus (6% + ½ (4%) = 8%). For the year-ended December 31, 20X8 compensation expense totalled $6.2 million including qualifying salaries totalled $5.0 million. During the same period, employees made $150,000 in contributions to the plan that qualified for matching. What is the total pension expense that GHS will recognize in its SCI for the year-ended December 31, 20X8?