At the end of the balances in the accounts related to the defined benefit pension plan of the Knight Company were as follows:
On Knight amended the plan to provide an increased amount of pension benefits; the prior service cost resulting from this
amendment was $ At the average remaining service life of employees expected to receive benefits was years.
The following information relates to the year :
In Knight's actual return on plan assets was $ Knight follows a policy of recognizing gainslosses a delayed basis
using the "corridor approach". At the end of there was one change in the estimates and assumptions relating to computation of the
projected benefit obligation, resulting in an increase in the PBO of $
Required:
a Prepare Knight's pension worksheet, and prepare the journal entry that Knight would make to record the expense calculated.
b Which items will be reported on the financial statements for and where will they be reported?
c Prepare the pension note required for the financial statements.
