Feinberg,Inc.,provides a noncontributory defined benefit plan for its 200 employees.Information from the company's pension footnote for the year ended December 31,2013,and partial information for the year ended December 31,2014,are given below:

The company's actuary indicated that the settlement rate and expected rate of return on plan assets were both 8% for 2013 and 2014.The company contributed $221,250 to the plan at the end of 2014.Service cost for 2014 was $125,000.
On January 1,2013,the company amended its plan to grant retroactive credit for prior service rendered by employees prior to the amendment.This amendment increased unrecognized prior service cost by $125,000 at that date.The prior service cost is being amortized over the average remaining service life of the employees affected by the amendment.The average remaining service life of the workforce in each year has been constant at 10.5 years.
(1)Prepare a schedule computing pension cost for 2014.
(2)Prepare the journal entries to record pension expense and the pension contribution,and to recognize the correct minimum liability,if any.
(3)Prepare the reconciliation between the beginning and ending balances of the projected benefit obligation as required by GAAP for the disclosures related to pension plans.

Question

Feinberg,Inc.,provides a noncontributory defined benefit plan for its 200 employees.Information from the company's pension footnote for the year ended December 31,2013,and partial information for the year ended December 31,2014,are given below:
  
The company's actuary indicated that the settlement rate and expected rate of return on plan assets were both 8% for 2013 and 2014.The company contributed $221,250 to the plan at the end of 2014.Service cost for 2014 was $125,000.
On January 1,2013,the company amended its plan to grant retroactive credit for prior service rendered by employees prior to the amendment.This amendment increased unrecognized prior service cost by $125,000 at that date.The prior service cost is being amortized over the average remaining service life of the employees affected by the amendment.The average remaining service life of the workforce in each year has been constant at 10.5 years.
(1)Prepare a schedule computing pension cost for 2014.
(2)Prepare the journal entries to record pension expense and the pension contribution,and to recognize the correct minimum liability,if any.
(3)Prepare the reconciliation between the beginning and ending balances of the projected benefit obligation as required by GAAP for the disclosures related to pension plans.

Quizplus · Accepted Answer

The Answer of Feinberg,Inc.,provides a noncontributory defined benefit plan for its 200 employees.Information from the company's pension footnote for the year ended December 31,2013,and partial information for the year ended December 31,2014,are given below:
  
The company's actuary indicated that the settlement rate and expected rate of return on plan assets were both 8% for 2013 and 2014.The company contributed $221,250 to the plan at the end of 2014.Service cost for 2014 was $125,000.
On January 1,2013,the company amended its plan to grant retroactive credit for prior service rendered by employees prior to the amendment.This amendment increased unrecognized prior service cost by $125,000 at that date.The prior service cost is being amortized over the average remaining service life of the employees affected by the amendment.The average remaining service life of the workforce in each year has been constant at 10.5 years.
(1)Prepare a schedule computing pension cost for 2014.
(2)Prepare the journal entries to record pension expense and the pension contribution,and to recognize the correct minimum liability,if any.
(3)Prepare the reconciliation between the beginning and ending balances of the projected benefit obligation as required by GAAP for the disclosures related to pension plans.