Gellhorn, Inc., had the following January 1 balances in relation to its defined benefit pension plan: Projected benefit

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Gellhorn, Inc., had the following January 1 balances in relation to its defined benefit pension plan: Projected benefit obligation $100,000 Plan assets (fair value) 100,000 During the year, Gellhorn amortized $10,000 of prior service cost and $10,000 of liability loss. Gellhorn also contributed $10,000 of funding to the plan. The plan paid $10,000 in benefits. The plan's discount rate is 6%. During the year, the plan achieved an 8% return on plan assets. Gellhorn's expected rate of return is 10%, and service cost was $10,000. Enter the appropriate amounts in the designated cells below. Indicate debit balances as positive numbers and credit balances as negative numbers using a leading minus (-) sign. Item Amount 1. Minimum required pension expense for year 2. Projected benefit obligation at December 31 3. Plan assets at December 31

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Computation of Minimum Required Pension Expense for the Year: Amortization of Prior Service Cost (PSC) 10,000 Amortization of Liability Loss 10,000 Interest Cost ($100,000*6%) 6,000 Service Cost 10,000 Expected Return on Plan Assets (100,000*10%) -10,000 Minimum Required Pension Expense for the Year 26,000 Computation of Projected Benefit Obligation at December 31: Projected Benefit Obligation, Beginning 100,000 Service Cost 10,000 Interest Cost 6,000 Benefits Paid -10,000 Projected Benefit Obligation at December 31 106,000 Computation of Plan Assets at December 31: Plan Assets, Beginning 100,000 Actual Return 8,000 Contribution 10,000 Benefit Paid -10,000 Plan Assets at December 31 108,000

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Gellhorn, Inc

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Computation of Minimum Required Pension Expense for the Year:
Amortization of Prior Service Cost (PSC)	10,000
Amortization of Liability Loss	10,000
Interest Cost ($100,000*6%)	6,000
Service Cost	10,000
Expected Return on Plan Assets (100,000*10%)	-10,000
Minimum Required Pension Expense for the Year	26,000

Computation of Projected Benefit Obligation at December 31:
Projected Benefit Obligation, Beginning	100,000
Service Cost	10,000
Interest Cost	6,000
Benefits Paid	-10,000
Projected Benefit Obligation at December 31	106,000

Computation of Plan Assets at December 31:
Plan Assets, Beginning	100,000
Actual Return	8,000
Contribution	10,000
Benefit Paid	-10,000
Plan Assets at December 31	108,000