Carla Company sponsors a defined benefit pension plan for its employees. The following data relate to the operation of the plan for the year 2017.1. The actuarial present value of future benefits earned by employees for services rendered in 2017 amounted to $82,000.2. The company’s funding policy requires a contribution to the pension trustee amounting to $151,000 for 2017.3. As of January 1, 2017, the company had a projected benefit obligation of $1,603,000 and a debit balance of $429,000 in accumulated OCI (PSC). The fair value of pension plan assets amounted to $1,373,000 at the beginning of the year. The actual and expected return on plan assets was $63,000. The settlement rate was 5%. No gains or losses occurred in 2017 and no benefits were paid.4. Amortization of prior service cost was $85,800 in 2017. Amortization of net gain or loss was not required in 2017.(a) Determine the amounts of the components of pension expense that should be recognized by the company in 2017.Pension Expense $enter the Pension Expense in dollars eTextbook and MediaList of Accounts Save for Later Attempts: 0 of 3 usedSubmit Answer (b)The parts of this question must be completed in order. This part will be available when you complete the part above. (c)The parts of this question must be completed in order. This part will be available when you complete the part above.

The annual cost of maintaining an employee's pension plan is referred to as pension expense. In…

Answered: Company sponsors a defined benefit…

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter19: Accounting For Post Retirement Benefits

Section: Chapter Questions

Problem 7RE

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Carla Company sponsors a defined benefit pension plan for its employees. The following data relate to the operation of the plan for the year 2017.

1.		The actuarial present value of future benefits earned by employees for services rendered in 2017 amounted to $82,000.
2.		The company’s funding policy requires a contribution to the pension trustee amounting to $151,000 for 2017.
3.		As of January 1, 2017, the company had a projected benefit obligation of $1,603,000 and a debit balance of $429,000 in accumulated OCI (PSC). The fair value of pension plan assets amounted to $1,373,000 at the beginning of the year. The actual and expected return on plan assets was $63,000. The settlement rate was 5%. No gains or losses occurred in 2017 and no benefits were paid.
4.		Amortization of prior service cost was $85,800 in 2017. Amortization of net gain or loss was not required in 2017.

(a)

Determine the amounts of the components of pension expense that should be recognized by the company in 2017.

Pension Expense

$enter the Pension Expense in dollars

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(b)

The parts of this question must be completed in order. This part will be available when you complete the part above.

(c)

The parts of this question must be completed in order. This part will be available when you complete the part above.

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