Answer:
The correct answer is $12,400.
Explanation:
According to the scenario, the computation of the given data are as follows:
We can calculate the pension expense by using following formula:
Pension expense = Interest cost + Service cost - Expected return on plan assets.
Where, Interest cost = $6,400
service cost = $17,000
Expected return on plan assets = $11,000
So, by putting the value, we get
Pension expense = $6,400 + $17,000 - $11,000 = $12,400
Hence, Journal entry for the following are as follows:
Pension Expense A/c Dr. $12,400
To Cash $12,400
