Waddle Company amended its defined benefit pension plan on January 1, 2009, to increase retirement benefits earned with each service year. The actuary estimated the prior service cost to be $216,000. Waddle's 80 present employees are expected to retire at the rate of about 10 each year at the end of each of the next 8 years.
Required:
1. Using the service method, calculate the amount of prior service cost to be amortized to pension expense in 2009.
2. Using the straight-line method, calculate the amount of prior service cost to be amortized to pension expense in 2009.

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The Answer of Waddle Company amended its defined benefit pension plan on January 1, 2009, to increase retirement benefits earned with each service year. The actuary estimated the prior service cost to be $216,000. Waddle's 80 present employees are expected to retire at the rate of about 10 each year at the end of each of the next 8 years.
Required:
1. Using the service method, calculate the amount of prior service cost to be amortized to pension expense in 2009.
2. Using the straight-line method, calculate the amount of prior service cost to be amortized to pension expense in 2009.

Waddle Company Amended Its Defined Benefit Pension Plan on January