Electronic Distribution has a defined benefit pension plan. Characteristics of the plan during 2018 are as follows:
($ in millions)
PBO balance, January 1.............................................$480
Plan assets balance, January 1........................................300
Service cost...............................................................75
Interest cost...............................................................45
Gain from change in actuarial assumption...........................22
Benefits paid...........................................................(36)
Actual return on plan assets...........................................20
Contributions 2018.....................................................60
The expected long-term rate of return on plan assets was 8%. 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 $12 million.
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?