2.

Pension data for Fahy Transportation Inc. include the following:

	($ in millions)
Discount rate, 7%
Expected return on plan assets, 10%
Actual return on plan assets, 11%
Projected benefit obligation, January 1	$	810
Plan assets (fair value), January 1		800
Plan assets (fair value), December 31		840
Benefit payments to retirees, December 31		83

Required:

Assuming cash contributions were made at the end of the year, what was the amount of those contributions?

6.

Lacy Construction has a noncontributory, defined benefit pension plan. At December 31, 2016, Lacy received the following information:

Projected Benefit Obligation	($ in millions)
Balance, January 1	$	460
Service cost		70
Prior service cost		22
Interest cost(5%)		23
Benefits paid		(62	)
Balance, December 31	$	513

Plan Assets	($ in millions)
Balance, January 1	$	330
Actual return on plan assets		35
Contributions 2016		70
Benefits paid		(62	)
Balance, December 31	$	373

The expected long-term rate of return on plan assets was 10%. There were no AOCI balances related to pensions on January 1, 2016. At the end of 2016, Lacy amended the pension formula creating a prior service cost of $22 million.

Assume Lacy Construction prepares its financial statements according to International Financial Reporting Standards and that the actuary's discount rate is the rate on high quality corporate bonds.

Required:

1.	Determine Lacys pension expense for 2016.

2.

Prepare the journal entry(s) to record Lacys pension expense, gains or losses, prior service cost, funding, and payment of retiree benefits for 2016.(If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millionsrounded to 1 decimal place (i.e., 5,500,000 should be entered as 5.5).)

• 1. Record the service cost.
• 2. Record the net interest cost.
• 3. Record the gain or loss on plan assets.
• 4. Record the funding.
• 5.Recordthepaymentofbenefits.
• 8.

Frazier Refrigeration amended its defined benefit pension plan on December 31, 2016, to increase retirement benefits earned with each service year. The consulting actuary estimated the prior service cost incurred by making the amendment retroactive to prior years to be $330,000. Fraziers 120 present employees are expected to retire at the rate of approximately 12 each year at the end of each of the next 10 years.

Required:

1.	Using the service method, calculate the amount of prior service cost to be amortized to pension expense in each of the next 10 years.(Enter you answers in thousands (i.e., 200,000 should be entered as 200).)

2.	Using the straight-line method, calculate the amount of prior service cost to be amortized to pension expense in each of the next 10 years.