In: Accounting
Pronghorn Co. provides the following information about its
postretirement benefit plan for the year 2020.
Service cost | $87,700 | ||
Prior service cost amortization | 3,200 | ||
Contribution to the plan | 60,500 | ||
Actual and expected return on plan assets | 62,100 | ||
Benefits paid | 39,000 | ||
Plan assets at January 1, 2020 | 704,000 | ||
Accumulated postretirement benefit obligation at January 1, 2020 | 763,900 | ||
Accumulated OCI (PSC) at January 1, 2020 | 101,900 | Dr. | |
Discount rate | 9 | % |
Prepare a worksheet inserting January 1, 2020, balances, showing
December 31, 2020, balances, and the journal entry recording
postretirement benefit expense. (Enter all amounts as
positive.)
Pension Worksheet - 2020 | ||||||||||||
General Journal Entries | Memo Record | |||||||||||
Items | Postretire Expense | Cash | OCR Prior Service Cost | Pension Assets/ Liabilites | APBO | Plan Assets | ||||||
Balance, jan. 01,2020 | $59,900 | $763,900.00 | Cr | $704,000 | Dr | |||||||
Service Cost | $87,700 | Dr. | $87,700 | Cr | - | |||||||
Interest cost -(763900 * 9%) | $68,751 | Dr. | $68,751 | Cr | - | |||||||
Actual / Exp return | 62,100 | Cr. | 62,100 | Dr | ||||||||
Amortization of Prior service cost | 3,200 | Dr. | $3,200 | Cr. | ||||||||
Contributions | $60,500 | Cr. | $60,500 | Dr | ||||||||
Benefits | 39,000 | Dr | 39,000 | Cr | ||||||||
Journal Entry for 2020 | 97,551 | Dr. | $60,500 | Cr. | 3,200 | Cr. | ($33,851.00) | Dr | 881,351 | Cr | 787,600 | Dr |
Accumulated OCI Prior service cost | 101,900 | Dr. | ||||||||||
Balance, Dec.31, 2020 | 98,700 | Dr. | 93,751 | 881,351 | Cr | 787,600 | Dr |
Journal Entry
Date | Particulars | LF | Debit | Credit |
Pension Expense | $97,551 | |||
Pension assets/liabilities | ($33,851) | |||
Cash | $60,500 | |||
OCI Prior Service Cost | 3,200 |