Electronic Distribution has a defined benefit pension plan. Characteristics of the plan during 2024 are as follows: ($ millions) $470 300 70 40 24 (34) 14 60 PBO balance, January 1 Plan assets balance, January 1 Service cost Interest cost Gain from change in actuarial assumption Benefits paid Actual return on plan assets Contributions 2024. The expected long-term rate of return on plan assets was 6 %. There were no AOCI balances related to pensions on January 1, 2024, but at the end of 2024, the company amended the pension formula, creating a prior service cost of $12 million. Required: 1. Calculate the pension expense for 2024. 2. Prepare the journal entries to record (a) pension expense, (b) gains or losses, (c) prior service cost, (d) funding, and (e) payment of benefits for 2024. 3. What amount will Electronic Distribution report in its 2024 balance sheet as a net pension asset or net pension liability? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare the journal entries to record (a) pension expense, (b) gains or losses, (c) prior service cost, (d) funding, and (e) payment of benefits for 2024. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions (i.e., 10,000,000 should be entered as 10). View transaction list Show less A
Electronic Distribution has a defined benefit pension plan. Characteristics of the plan during 2024 are as follows: ($ millions) $470 300 70 40 24 (34) 14 60 PBO balance, January 1 Plan assets balance, January 1 Service cost Interest cost Gain from change in actuarial assumption Benefits paid Actual return on plan assets Contributions 2024. The expected long-term rate of return on plan assets was 6 %. There were no AOCI balances related to pensions on January 1, 2024, but at the end of 2024, the company amended the pension formula, creating a prior service cost of $12 million. Required: 1. Calculate the pension expense for 2024. 2. Prepare the journal entries to record (a) pension expense, (b) gains or losses, (c) prior service cost, (d) funding, and (e) payment of benefits for 2024. 3. What amount will Electronic Distribution report in its 2024 balance sheet as a net pension asset or net pension liability? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare the journal entries to record (a) pension expense, (b) gains or losses, (c) prior service cost, (d) funding, and (e) payment of benefits for 2024. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions (i.e., 10,000,000 should be entered as 10). View transaction list Show less A
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:Electronic Distribution has a defined benefit pension plan. Characteristics of the plan during 2024 are as follows:
($ millions)
$470
300
PBO balance, January 1
Plan assets balance, January 1
Service cost
Interest cost
Gain from change in actuarial assumption
Benefits paid
Actual return on plan assets
Contributions 2024
The expected long-term rate of return on plan assets was 6%. There were no AOCI balances related to pensions on January 1, 2024,
but at the end of 2024, the company amended the pension formula, creating a prior service cost of $12 million.
Required:
1. Calculate the pension expense for 2024.
2. Prepare the journal entries to record (a) pension expense, (b) gains or losses, (c) prior service cost, (d) funding, and (e) payment of
benefits for 2024.
3. What amount will Electronic Distribution report in its 2024 balance sheet as a net pension asset or net pension liability?
Complete this question by entering your answers in the tabs below.
Required 1
Required 2 Required 3
Prepare the journal entries to record (a) pension expense, (b) gains or losses, (c) prior service cost, (d) funding, and (e) payment of
benefits for 2024.
Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers
in millions (i.e., 10,000,000 should be entered as 10).
View transaction list
Journal entry
worksheet
1
2
70
40
24
(34)
14
60
3
Record the pension expense.
4
5
6
Show less A
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 5 steps with 6 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education