Prepare a pension spreadsheet to show the relationship among the PBO, plan assets, prior service cost, the net gain, pension expense, and the net pension asset.
Beale Management has a noncontributory, defined benefit pension plan. On December 31, 2021 (the end of Beale’s fiscal year), the following pension-related data were available:
Projected Benefit Obligation ($ in millions)
Balance, January 1, 2021 $ 540
Service cost 56
Interest cost, discount rate, 5% 27
Gain due to changes in actuarial assumptions in 2021 (11)
Pension benefits paid (27)
Balance, December 31, 2021 $ 585
Plan Assets ($ in millions)
Balance, January 1, 2021 $ 570
Actual return on plan assets 37
(Expected return on plan assets, $42)
Cash contributions 78
Pension benefits paid (27)
Balance, December 31, 2021 $ 658
January 1, 2021, balances: ($ in millions)
Pension asset $ 30
Prior service cost—AOCI (amortization $5 per year) 25
Net gain—AOCI (any amortization over 10 years) 107
Required:
Prepare a pension spreadsheet to show the relationship among the PBO, plan assets, prior service cost, the net gain, pension expense, and the net pension asset. (Enter credit amounts with a minus sign and debit amounts with a positive sign. Enter your answers in millions.)
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