Measuring and recording pension expense
Pumpkin Ltd. received the following information from its pension plan trustee concerning their defined benefit pension plan for the year ended December 31, 2020 $\begin{array}{lcc}
& \text { January } 1,2020 & \text { Dece mber } 31,2020 \
\text { Defined benefit obligation } & \$ 3,500,000 & \$ 3,990,000 \
\text { Fair value of plan assets } & 1,750,000 & 1,882,000
\end{array}$ For 2020, the service cost is $ 210,000 and past service cost (effective Jan 1) is $ 100,000. During 2020, Pumpkin contributed $ 595,000 to the plan. The actual and expected return on plan assets is 8%. Pumpkin uses IFRS.
Instructions
a) Calculate the pension expense to be reported in 2020.
b) Prepare the journal entries to record the pension expense and the employer's contribution for 2020.

Question

Measuring and recording pension expense
Pumpkin Ltd. received the following information from its pension plan trustee concerning their defined benefit pension plan for the year ended December 31, 2020 $\begin{array}{lcc} 
& \text { January } 1,2020 & \text { Dece mber } 31,2020 \
\text { Defined benefit obligation } & \$ 3,500,000 & \$ 3,990,000 \
\text { Fair value of plan assets } & 1,750,000 & 1,882,000
\end{array}$ For 2020, the service cost is $ 210,000 and past service cost (effective Jan 1) is $ 100,000. During 2020, Pumpkin contributed $ 595,000 to the plan. The actual and expected return on plan assets is 8%. Pumpkin uses IFRS.
Instructions 
a) Calculate the pension expense to be reported in 2020.
b) Prepare the journal entries to record the pension expense and the employer's contribution for 2020.

Quizplus · Accepted Answer

The Answer of Measuring and recording pension expense
Pumpkin Ltd. received the following information from its pension plan trustee concerning their defined benefit pension plan for the year ended December 31, 2020 $\begin{array}{lcc} 
& \text { January } 1,2020 & \text { Dece mber } 31,2020 \
\text { Defined benefit obligation } & \$ 3,500,000 & \$ 3,990,000 \
\text { Fair value of plan assets } & 1,750,000 & 1,882,000
\end{array}$ For 2020, the service cost is $ 210,000 and past service cost (effective Jan 1) is $ 100,000. During 2020, Pumpkin contributed $ 595,000 to the plan. The actual and expected return on plan assets is 8%. Pumpkin uses IFRS.
Instructions 
a) Calculate the pension expense to be reported in 2020.
b) Prepare the journal entries to record the pension expense and the employer's contribution for 2020.

Measuring and Recording Pension Expense Pumpkin Ltd For 2020, the Service Cost Is $ 210,000 and Past

Measuring and Recording Pension Expense
Pumpkin Ltd For 2020, the Service Cost Is $ 210,000 and Past