In: Accounting
21-Carolina Consulting Company has a defined benefit pension plan. The following pension-related data were available for the current calendar year:
PBO: |
||||
Balance, Jan. 1 |
$ |
237,000 |
||
Service cost |
38,000 |
|||
Interest cost (5% discount rate) |
11,850 |
|||
Gain from changes in actuarial assumptions in 2021 |
(4,700 |
) |
||
Benefits paid to retirees |
(17,000 |
) |
||
Balance, Dec. 31 |
$ |
265,150 |
||
Plan assets: |
||||
Balance, Jan.1 |
$ |
247,000 |
||
Actual return (expected return was $22,200) |
20,000 |
|||
Contributions |
32,000 |
|||
Benefits paid |
(17,000 |
) |
||
Balance, Dec. 31 |
$ |
282,000 |
||
ABO, Dec. 31 |
$ |
241,700 |
||
January 1, 2021, balances: |
||||
Prior service cost–AOCI (amortization $4,945/yr.) |
4,945 |
|||
Net gain–AOCI (amortization, if any, over 15 years) |
49,450 |
|||
There were no other relevant data.
Required:
1. Calculate the 2021 pension expense.
2. Prepare the 2021 journal entries to record pension expense and funding.
3. Prepare any journal entries to record any 2021 gains or losses.
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