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On December 31, 2019, Robey Company accumulated the following information for 2019 in regard to its...

On December 31, 2019, Robey Company accumulated the following information for 2019 in regard to its defined benefit pension plan:

Service cost $110,830
Interest cost on projected benefit obligation 11,470
Expected return on plan assets 10,390
Amortization of prior service cost 2,140

On its December 31, 2018, balance sheet, Robey had reported an accrued/prepaid pension cost liability of $13,000.

Required:

1. Compute the amount of Robey’s pension expense for 2019.
2. Prepare all the journal entries related to Robey’s pension plan for 2019 if it funds the pension plan in the amount of (a) $114,050, (b) $113,010, and (c) $118,030.
3. Next Level Assuming Robey’s beginning 2019 Accumulated Other Comprehensive Income: Prior Service Cost balance was $54,940 what would be its ending balance?
4. Next Level How much would Robey need to fund its pension plan for 2019 in order to report an accrued/ prepaid pension cost asset of $4,690 at the end of 2019?
CHART OF ACCOUNTS
Robey Company
General Ledger
ASSETS
111 Cash
121 Accounts Receivable
141 Inventory
152 Prepaid Insurance
181 Equipment
198 Accumulated Depreciation
LIABILITIES
211 Accounts Payable
231 Salaries Payable
250 Unearned Revenue
251 Accrued/Prepaid Pension Cost
261 Income Taxes Payable
EQUITY
311 Common Stock
331 Retained Earnings
916 Other Comprehensive Income: Prior Service Cost
REVENUE
411 Sales Revenue
EXPENSES
500 Cost of Goods Sold
511 Insurance Expense
512 Utilities Expense
521 Salaries Expense
522 Pension Expense
532 Bad Debt Expense
540 Interest Expense
541 Depreciation Expense
559 Miscellaneous Expenses
910 Income Tax Expense

1. Compute the amount of Robey’s pension expense for 2019.

2a. Assume Robey Company funds the pension plan in the amount of $114,050. Prepare the entries to record the pension expense for 2019 on December 31 and the amortized prior service cost for 2019 on December 31.

General Journal Instructions

PAGE 1

GENERAL JOURNAL

DATE ACCOUNT TITLE POST. REF. DEBIT CREDIT

1

2

3

4

2b. Assume Robey Company funds the pension plan in the amount of $113,010. Prepare the entries to record the pension expense for 2019 on December 31 and the amortized prior service cost for 2019 on December 31.

General Journal Instructions

PAGE 1

GENERAL JOURNAL

DATE ACCOUNT TITLE POST. REF. DEBIT CREDIT

1

2

3

4

5

2c. Assume Robey Company funds the pension plan in the amount of $118,030. Prepare the entries to record the pension expense for 2019 on December 31 and the amortized prior service cost for 2019 on December 31.

PAGE 1

GENERAL JOURNAL

DATE ACCOUNT TITLE POST. REF. DEBIT CREDIT

1

2

3

4

5

3. Assuming Robey’s beginning 2019 Accumulated Other Comprehensive Income: Prior Service Cost balance was $54,940 what would be its ending balance?

4. How much would Robey need to fund its pension plan for 2019 in order to report an accrued/ prepaid pension cost asset of $4,690 at the end of 2019?

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