Buhl Corp. sponsors a defined benefit pension plan for its employees. On January 1, 2014, the following balances relate to this plan.\nPlan assets $480
Buhl Corp. sponsors a defined benefit pension plan for its employees. On January 1, 2014, the following balances relate to this plan.
\r\nPlan assets $480,000
\r\nDefi ned benefi t obligation 600,000
\r\nPension asset/liability 120,000
\r\nAs a result of the operation of the plan during 2014, the following additional data are provided by the actuary.
\r\nService cost for 2014 $90,000
\r\nDiscount rate, 6%
\r\nActual return on plan assets in 2014 55,000
\r\nUnexpected loss from change in defi ned benefi t obligation, due to change in actuarial predictions 76,000
\r\nContributions in 2014 99,000
\r\nBenefi ts paid retirees in 2014 85,000
\r\nInstructions
\r\n(a) Using the data above, compute pension expense for Buhl Corp. for the year 2014 by preparing a pension worksheet.
\r\n(b) Prepare the journal entry for pension expense for 2014.