Financial & Managerial Accounting 17th Edition by Jan Williams ,Susan Haka,Mark Bettner,Joseph Carcello

Exercise 41

Pension and Other Postretirement Benefit Costs
Grammar, Inc., offers its full-time employees pension and other postretirement benefits, primarily health insurance. During the current year, pension benefits for the employees totaled $250,000. Other postretirement benefits totaled $140,000. The pension benefits are fully funded by the company by transferring cash to a trustee that administers the plan. The other postretirement benefits are similarly funded, but only at the 50 percent level. Prepare journal entries to record the two expenses, and determine the total amount that Grammar will need to transfer to its trustee for both benefit plans during the current year