Question

Using the information in E20-2, prepare a pension worksheet inserting January 1, 2017, balances, showing December 31, 2017, balances, and the journal entry recording pension expense.

Short answer

A pension Worksheet is the kind of pension statement which includes all of the organization's necessary information related to the defined benefit pension plans. This worksheet recordsthe pension expense entries in the journal book.

Step-by-step solution

Computation of Pension Worksheet as of January 1, 2017.

Veldre Company
Pension Worksheet for the year 2017
General Journal Entries	Memo Record
Particulars	Annual pension expense	Cash	OCI prior service cost	Pension asset/liability	Projected benefit obligation	Plan Assets
Balance Jan 1, 2017				$60,000 Cr.	$700,000 Cr.	$640,000 Dr.
Service cost	$90,000 Dr.				$90,000 Cr.
Interest cost $\left(\mathbf{\$}\mathbf{700}\mathbf{,}\mathbf{000}\mathbf{\times }\mathbf{10}\mathbf{\%}\right)$	$70,000 Dr.				$70,000 Cr.
Actual return	$64,000 Cr.					$64,000 Dr.
Amortization of PSC	$10,000 Dr.		$10,000 Cr.
Contributions		$105,000 Cr.				$105,0000 Dr.
Benefits					$40,000 Dr.	$40,000 Cr.
Journal entry for 2017	$106,000 Dr.	$105,000 Cr.	$10,000 Cr.	$9,000 Dr.
Accumulated OCI Dec 31, 2016			$150,000 Dr.
Balance Dec 31, 2017			$140,000 Dr.	$1,000 Cr.	$820,000 Cr.	$769,000 Dr.

Journal entry for recording the transaction of pension expense for the year 2017.

Veldre Company
Journal Entry
Date	Particulars	Debit	Credit
2017	Pension Expense	$106,000
	Pension Asset/Liability	$9,000
	Other comprehensive income		$10,000
	Cash		$105,000
	(To record the pension expense)