Actuary and trustee reports indicate the following changes in the PBO and plan assets of Douglas-Roberts...

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Accounting

Actuary and trustee reports indicate the following changes inthe PBO and plan assets of Douglas-Roberts Industries during2021:
Prior service cost at Jan. 1, 2021, from plan amendment atthe
beginning of 2018 (amortization: $3 million per year) $ 21 million
Net loss—AOCI at Jan.1, 2021 (previous losses exceeded previousgains) $ 160 million
Average remaining service life of the active employeegroup 10 years
Actuary's discount rate 7 %
($ in millions) Plan
PBO Assets
Beginning of 2021 $ 600 Beginning of 2021 $ 400
Service cost 54 Return on plan assets,
8% (10% expected) 32
Interest cost, 7% 42
Loss (gain) on PBO (11 ) Cash contributions 98
Less: Retiree benefits (32 ) Less: Retiree benefits (32 )
End of 2021 $ 653 End of 2021 $ 498

Required:
1-a. Determine Douglas-Roberts's pension expensefor 2021.
1-b, 2. to 4. Prepare the appropriate journalentries to record the pension expense, to record any 2021 gains andlosses, to record the cash contribution to plan assets and torecord retiree benefits.

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4.3 Ratings (579 Votes)

1a Service Cost 54 Interest Cost 42 Expected Return on Plan assets 400 10 40 Amortization of Prior Service Costs 3 Amortization of Net Loss See working below 10 Pension Expense 69 See Answer

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Prior service cost at Jan. 1, 2021, from plan amendment atthe beginning of 2018 (amortization: $3 million per year)	$	21	million
Net loss—AOCI at Jan.1, 2021 (previous losses exceeded previousgains)	$	160	million
Average remaining service life of the active employeegroup		10	years
Actuary's discount rate		7	%

($ in millions)				Plan
PBO				Assets
Beginning of 2021	$	600		Beginning of 2021	$	400
Service cost		54		Return on plan assets,
				8% (10% expected)		32
Interest cost, 7%		42
Loss (gain) on PBO		(11	)	Cash contributions		98
Less: Retiree benefits		(32	)	Less: Retiree benefits		(32	)
End of 2021	$	653		End of 2021	$	498