The following defined pension data of Rydell Corp. apply to the year 2014. For 2

Question

The following defined pension data of Rydell Corp. apply to the year 2014.

For 2014, prepare a pension worksheet for Rydell Corp. that shows the journal entry for pension expense and the year-end balances in the related pension accounts.

RYDELL CORP.
Pension Worksheet—2014

General Journal Entries

Memo Record

Items

Annual Pension
Expense

Cash

OCI–Prior
Service Cost

Pension
Asset/
Liability

Projected Benefit
Obligation

Plan
Assets

  

Projected benefit obligation, 1/1/14 (before amendment) $565,800 Plan assets, 1/1/14 545,100 Pension liability 20,700 On January 1, 2014, Rydell Corp., through plan amendment,
   grants prior service benefits having a present value of 128,200 Settlement rate 10 % Service cost 66,900 Contributions (funding) 66,200 Actual (expected) return on plan assets 54,200 Benefits paid to retirees 41,300 Prior service cost amortization for 2014 17,500

Explanation / Answer

RYDELL CORP. Pension Worksheet—2014 General Journal Entries Memo Record Items Annual Pension Expense Cash OCI–Prior Service Cost Pension Asset / Liability Projected Benefit Obligation Plan Assets Balance, Dec. 31, 2013 $   20,700.00 Cr. $565,800.00 Cr. $545,100.00   Dr. Prior service cost $128,200.00   Dr $128,200.00 Cr. Balance, Jan. 1, 2014 $694,000.00 Cr. $545,100.00   Dr. Service cost $66,900.00   Dr. $   66,900.00 Cr. Interest cost (694000*10%) $69,400.00   Dr. $   69,400.00 Cr. Actual return $54,200.00 Cr. $   54,200.00   Dr. Amortization of PSC $17,500.00   Dr. $   17,500.00 Cr. Contributions $66,200.00 Cr. $   66,200.00   Dr. Benefits $   41,300.00   Dr. $   41,300.00 Cr. Journal entry for 2014 $99,600.00   Dr. $66,200.00 Cr. $110,700.00   Dr. $144,100.00 Cr. Accumulated OCI, Dec. 31, 2013 Balance, Dec. 31, 2014

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