(Answered) Question - on january 1 2012 harrington company has the

Accounting

Question - On January 1, 2012, Harrington Company has the following defined benefit pension plan balances.

Projected benefits obligation $5,600,000

Fair value of plan assets 6,400,000

The interest (settlement) rate applicable to the plan is 9%. On January 1, 2013, the company amends its pension agreement so that service costs of $620,000 are created. Other data related to the pension plan are as follows:

2012 2013

Service costs $180,000 $195,000

Prior service costs 0 97,000 amortization

Contributions (funding) 255,000 305,000 to the plan

Benefits paid 225,000 300,000

Actual return on plan 320,000 515,000 assets

Expected rate of return 5% 8% on assets

Instructions:

(a) Prepare a pension worksheet for the pension plan for 2012 and 2013.

(b) For 2013, prepare the journal entry to record pension-related amounts.

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