Tucker, Inc. on Jan. 1, 2011 initiated a noncontrubutory, defined-benefit pension plan that that grants benefits to 100 employees. The total expected service-years is 1200. The present value of the benefit obligation on Jan. 31, 2011 was 5,040,000. The Dec. 31, 2011 plan information: Employer's Contribution 1,600,000; Service Cost 600,000; Projected Benefit Obligation 6,043,200; Plan Assets (at Fair Value) 1,600,000; ROA 9%; Settlement Rate 8%.
1. Compute pension expense for 2011-Assume prior svc cost is amortized over the remaining svc life of the employees.
2. Prepare journal entries for yr. ending 2011
3. Indicate amts for income statement & balance sheet for 2011.