Ditek
Corp. provides a defined contribution pension plan for its employees. Under the
plan, the company is required to contribute 3% of employees’ gross pay to a
fund trustee each year. Ditek’s total payroll for 2011 was $2,732,864 and the
company made all required payments within the year. Prepare a summary journal
entry to record Ditek’s pension expense for the year.
Pension Expense........................... 81,986
Cash.................................. 81,986
($2,732,864
X 3% = $81,986)
