Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. electronic distribution has a defined benefit pens

Electronic Distribution has a defined benefit pension plan. Characteristics of the plan during 2018 are...

70.2K

Verified Solution

Question

Accounting

Electronic Distribution has a defined benefit pension plan. Characteristics of the plan during 2018 are as follows:

($ millions)
PBO balance, January 1 $ 460
Plan assets balance, January 1 250
Service cost 65
Interest cost 35
Gain from change in actuarial assumption 22
Benefits paid (32)
Actual return on plan assets 22
Contributions 2018 55

The expected long-term rate of return on plan assets was 10%. There were no AOCI balances related to pensions on January 1, 2018, but at the end of 2018, the company amended the pension formula creating a prior service cost of $11 million. (Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) Required:

1. Calculate the pension expense for 2018. 2. Prepare the journal entry to record pension expense, gains or losses, prior service cost, funding, and payment of benefits for 2018. 3. What amount will Electronic Distribution report in its 2018 balance sheet as a net pension asset or net pension liability?

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students