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Question(s) / Instruction(s):

*Ex. 20-87—Computing and recording postretirement expense.
The following information is related to the Santo Co. postretirement benefits plan for 2004:

Service cost

$ 210,000

 

Discount rate

10%

 

EPBO, January 1, 2004

1,025,000

 

APBO, January 1, 2004

800,000

 

Unrecognized transition amount amortization

41,000

 

Actual return on plan assets in 2004

28,000

 

Expected return on plan assets in 2004

36,500

 

Contributions (funding)

280,000

Instructions
(a)     Compute the amount of postretirement expense for 2004. (Show computations.)
(b)     Prepare the journal entry to record postretirement expense and Santo's contributions for 2004.


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