Axel Corporation has a defined benefit pension plan. At January 1,2012,the following balances exist:
For the year ended December 31,2012,the current service cost as determined by an appropriate actuarial cost method was $265,000. A change in actuarial assumptions created a gain of $16,000 in 2012. The expected return on plan assets was $65,200; however,the actual return is $63,700. The expected period of full eligibility at January 1,2012 (i.e.,the vesting period)is 10 years,while the expected average remaining service life is 20 years. Axel paid $220,700 to the pension trustee in December 2012. The company recognizes only the minimum amount of corridor amortization.
Requirement:
Prepare the journal entry to record pension expense for 2012.

Question

Axel Corporation has a defined benefit pension plan. At January 1,2012,the following balances exist:
  For the year ended December 31,2012,the current service cost as determined by an appropriate actuarial cost method was $265,000. A change in actuarial assumptions created a gain of $16,000 in 2012. The expected return on plan assets was $65,200; however,the actual return is $63,700. The expected period of full eligibility at January 1,2012 (i.e.,the vesting period)is 10 years,while the expected average remaining service life is 20 years. Axel paid $220,700 to the pension trustee in December 2012. The company recognizes only the minimum amount of corridor amortization.
Requirement:
Prepare the journal entry to record pension expense for 2012.

Quizplus · Accepted Answer

The Answer of Axel Corporation has a defined benefit pension plan. At January 1,2012,the following balances exist:
  For the year ended December 31,2012,the current service cost as determined by an appropriate actuarial cost method was $265,000. A change in actuarial assumptions created a gain of $16,000 in 2012. The expected return on plan assets was $65,200; however,the actual return is $63,700. The expected period of full eligibility at January 1,2012 (i.e.,the vesting period)is 10 years,while the expected average remaining service life is 20 years. Axel paid $220,700 to the pension trustee in December 2012. The company recognizes only the minimum amount of corridor amortization.
Requirement:
Prepare the journal entry to record pension expense for 2012.

Axel Corporation Has a Defined Benefit Pension Plan