The following facts apply to the pension plan of I-Pass Corporation for the year 2010.
Plan assets, January 1, 2010 $950,000
Projected benefit obligation, January 1, 2010 950,000
Settlement rate 6%
Service cost 75,000
Contributions (funding) 10,000
Actual and expected return on plan assets 40,600
Benefits paid to retirees 42,200
Instructions:
Using the preceding data, compute pension expense for the year 2010. As part of your solution, prepare a pension worksheet that shows the journal entry for pension expense for 2010 and the year-end balances in the related pension accounts.