Problem 2-Pensions Presented below is information related to Core Department Sto

Question

Problem 2-Pensions Presented below is information related to Core Department Stores, Inc. pension plan for 2017 Plan Assets (Fair Value), January 1 Projected Benefit Obligation, January 1 Prior Service Cost, January 1 Service Cost Settlement Rate Actual Return on Plan Assets Expected Return on Plan Assets Pension Contributions by Core Accumulated benefit obligation at December 31 Average remaining service life of all employees Vested benefit obligation at December 31 $699,000 800,000 220,000 90,000 9% 996 64,500 10% 120,000 739,600 20 years 768,000 At the beginning of 2017, the actuary determines that the retirement period for all retirees will increase by an average of 2 years, increasing the projected benefit obligation by $152,000. Instructions Prepare the journal entry to record pension expense and the employer's contribution for 2017.

Explanation / Answer

1. Calculation Of Pension Expense Service Cost 90000 :+ Interest Cost 0 Actual return on plan assets 64500 Amortization of prior service costs 220000 Gain or loss 63450 437950 Journal Entry: Pension Expense A/C Dr 437950 To Cash 120000 TO Prepaid Expense A/c 317950 2. Calculation Of employers contribution 8.33% Pension Amount= 36481.235 Pension Expense A/C Dr 36481.235 To Cash 36481.235

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