On January 1, 2011, Cubs Corporation adopted a defined benefit pension plan. The plan's service cost of $150,000 was fully funded at the end of 2011. Prior service cost was funded by a contribution of $60,000 in 2011. Amortization of prior service cost was $24,000 for 2011. What is the amount of Cub's prepaid pension cost at December 31, 2011?

Question

Quizplus · Accepted Answer

The prepaid pension cost is calculated as the difference between the contributions made and the total pension expense. The service cost is $150,000, and the amortization of prior service cost is $24,000, totaling $174,000 in pension expense. Cubs Corporation contributed $210,000 ($150,000 + $60,000) in total. Therefore, the prepaid pension cost is $210,000 - $174,000 = $36,000.

On January 1, 2011, Cubs Corporation Adopted a Defined Benefit