Preparation of a Pension Worksheet and Pension Entries
the Accountant

Preparation of a pension worksheet and pension entries
The accountant for Camberwell Ltd. has developed the following information regarding the company's defined benefit pension plan for calendar 2020: $\begin{array}{ll}\text{ Service cost } ..................................................... & \$ 600,000 \\\text{Actual return on plan assets }............................ & 315,000 \\\text{ Contributions } ................................................& 1,080,000 \\\text{ Benefits paid to retirees } ................................. & 72,000 \\\text{ Interest (discount) rate } .............................. ...& 10\% \\ \end{array}$
Instructions
a) Using the above information, complete the pension work sheet below for 2020. Indicate credit entries by parentheses, e.g. (72,000).
b) Prepare the journal entries to reflect the accounting for the company's pension plan for the year ended December 31, 2020.
$\begin{array}{ll} &\text{ General Journal Entries } && & \quad\quad\quad \text{ Memo Entries } \\\\\hline & \text{ Annual } & & \text{ Net Defined } & \text{ Defined } & \\ &\text{ Pension } & & \text{ Benefit } & \text{ Benefit } & \text{ Plan } \\ &\text{ Expense} & \text{ Cash} & \text{ Asset/Liab } & \text{ Obligation } &\text{ Assets } \\\hline \text{ Bal. Dec. 31, 2019 }& & & (1,200,000) & (4,500,000) & 3,300,000 \\\\\text{ Service cost } \\\text{ nterest cost }I \\ \text{ Actual return} \\ \text{ Contributions } \\ \text{ Benefits paid } \\ \text{ Journal entry for 2020 } &- &-&-&-&-\\ \text{ Bal. Dec. 31, 2020 } &- &-&-&-&- \\ \end{array}$