91Ó°ÊÓ

Particulars

Amount

Projected benefit obligation on 1/1/17

$560,000

Plan assets on 1/1/17

$546,200

Pension liability

$13,800

Settlement rate

9%

Prior service benefits

$120,000

Service cost

$58,000

Contributions

$65,000

Actual return on plan assets

$52,280

Benefits paid to retirees

$40,000

Prior service cost amortization

$17,000

Particulars

Annual pension expense

Cash

OCI prior service cost

Pension asset/liability

Projected benefit obligation

Plan Assets

Balance Dec 31, 2016

0

$13,800 Cr.

$560,000 Cr.

$546,200 Dr.

Prior Service cost

$120,000 Dr.

$120,000 Cr.

Balance Jan 1, 2017

$680,000 Cr.

$546,200 Dr.

Service cost

$58,000 Dr.

$58,000 Cr.

Interest cost $\left(\mathbf{\$}\mathbf{680}\mathbf{,}\mathbf{000}\mathbf{×}\mathbf{9}\mathbf{\%}\right)$

$61,200 Dr.

$61,200 Cr.

Actual return

$52,280 Cr.

$52,280 Dr.

Amortization of PSC

$17,000 Dr.

$17,000 Cr.

Contributions

$65,000 Cr.

$65,0000 Dr.

Benefits

$40,000 Dr.

$40,000 Cr.

Journal entry for 2017

$83,920 Dr.

$65,000 Cr.

$103,000 Dr.

$121,920Cr.

Accumulated OCI Dec 31, 2016

0.

Balance Dec 31, 2017

$103,000 Dr.

$135,720 Cr.

$759,200 Cr.

$623,480 Dr.