Final answer:
The journal entry for Yuri Co.'s accrued pension liability on December 31 would be a debit to Pension Expense for $157,100 and a credit to Pension Liability for $157,100. This reflects the quarterly pension cost and the company's obligation under their defined contribution pension plan.
Step-by-step explanation:
To journalize the entry to record the accrued pension liability on December 31 for Yuri Co., you must recognize the pension expense for the period and the corresponding liability. Since the pension cost for the quarter ended December 31 is $157,100 and the company is required to pay this to the funding agent, Whims Funds, by the fifteenth of the following month, you need to account for this liability at the end of the quarter.
The journal entry would be:
- Debit Pension Expense $157,100
- Credit Pension Liability $157,100
This entry reflects the company's obligation to pay the pension plan installment. Defined contribution plans, like 401(k)s and 403(b)s, involve the company contributing a fixed amount to the employee's retirement account regularly. This is part of the changing landscape of retirement planning, making these contributions crucial to the future financial stability of retirees.