(P ensio n Expense , Journa l Entrie s fo r 2 Y ears ) Gordon Company sponsors a defined benefit

 
   

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(P ensio n Expense , Journa l Entrie s fo r 2 Y ears ) Gordon Company sponsors a defined benefit pension

plan. The following information r elated to the pension plan is available for 2014 and 2015.

2014

2015

Plan assets (fair value), December 31

$699,000

$849,000

Projected benefit obligation, January 1

700,000

800,000

Pension asset/liability, January 1

140,000 Cr.

?

Prior service cost, January 1

250,000

240,000

Service cost

60,000

90,000

Actual and expected return on plan assets

24,000

30,000

Amortization of prior service cost

10,000

12,000

Contributions (funding)

115,000

120,000

Accumulated benefit obligation, December 31

500,000

550,000

Interest/settlement rate

9%

9%

Instructions

(a) Compute pension expense for 2014 and 2015.

(b) P r epa r e the journal entries to r eco r d the pension expense and the company’s funding of the pension

plan for both years.