(Answered) On january 1 2014 vermont ltd reported the following

Accounting

On January 1, 2014, Vermont Ltd. reported the following balances relating to their defined benefit pension plan:

Defined benefit obligation ........................ $1,600,000

Fair value of plan assets .......................... 1,600,000

Other data related to the pension plan for calendar 2014 are:

Current service cost ................................70,000

Contributions to the plan .........................102,000

Benefits paid .........................................100,000

Actual return on plan assets ....................96,000

Interest (discount) rate ...........................9%

Vermont uses the immediate recognition approach.

Instructions

a. Calculate the defined benefit obligation at December 31, 2014.

b. Calculate the fair value of plan assets at December 31, 2014.

c. Calculate pension expense for 2014.

d. Prepare the journal entries to record the pension expense and the contributions for 2014.

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