Maines Company provides the following information about its defined benefit pension plan for the year 2006: Service Cost 90,000 Plan Contributions 105,000 Prior Service Cost (PSC) Amortization 10,000 Benefits Paid 40,000 Plan Assets on Jan. 1, 2006 640,000 PBO on Jan. 1, 2006 800,000 Unrecognized PSC on Jan. 1, 2006 150,000 Actual and Expected Return on Plan Assets 10% Discount Rate 9% The tax rate for Maines Company is 35%. Required: Using the above information, compute Maines Company’s 2006 pension expense. Prepare a pension worksheet detailing Maines Company’s 2006 pension plan activity. Write the 2006 journal entry Maines Company will make to record its 2006 pension activity. What pension-related balances will appear on Maines Company’s 2006 balance sheet?
Maines Company provides the following information about its defined benefit pension plan for the year 2006:
Service Cost 90,000
Plan Contributions 105,000
Prior Service Cost (PSC) Amortization 10,000
Benefits Paid 40,000
Plan Assets on Jan. 1, 2006 640,000
PBO on Jan. 1, 2006 800,000
Unrecognized PSC on Jan. 1, 2006 150,000
Actual and Expected Return on Plan Assets 10%
Discount Rate 9%
The tax rate for Maines Company is 35%.
Required:
- Using the above information, compute Maines Company’s 2006 pension expense.
- Prepare a pension worksheet detailing Maines Company’s 2006 pension plan activity.
- Write the 2006
journal entry Maines Company will make to record its 2006 pension activity.
- What pension-related balances will appear on Maines Company’s 2006 balance sheet?
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