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Pronghorn Co. provides the following information about its postretirement benefit plan for the year 2020. Service...

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.)

Solutions

Expert Solution

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

ekkarill92 answered 2 years ago
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