A partially completed pension spreadsheet showing the relationships among the elements that constitute Carney, Inc 's defined benefit pension plan follows Six years earlier, Carney revised its pension formula and recalculated benefits earned by employees in prior years using the more generous formula The prior service cost created by the recalculation is being amortized at the rate of $4 million per year At the end of 2021, the pension formula was amended again, creating an additional prior service cost of $30 million The expected rate of return on assets and the actuary's discount rate were 10 , and the average remaining service life of the active employee group is 10 years Required Fill in the missing amounts Prepare the 2021 journal entry to record pension expense Prepare the journal entry(s) to record any 2021 gains and losses and new prior service cost in 2021 Prepare the 2021 journal entries to record (a) the cash contribution to plan assets and (b) the payment of retiree benefits ( )s indicate credits debits otherwise($ in millions)PBOPlan AssetsPrior Service Cost AOCINet Loss AOCIPension ExpenseCashNet Pension (Liability) AssetBalance, Jan 1, 2021(950)900501050 0 (50)Service cost(94) 0 0 0 940 (94) Interest cost(95) 0 0 0 95 0 (95) Expected return on assets0 90 0 0 (90) 0 90 Adjust for Loss on assets0 (9)0 9 0 0 (9) Amortization of Prior service cost0 0 (4) 0 4 0 0 Net loss0 0 0 (1) 1 0 0 Loss on PBO(25) 0 0 25 0 0 (25)Prior service cost(30) 0 30 0 0 0 (30) Cash funding0 90 0 0 0 (90) 90Retiree benefits 0 0 0 0 0 Bal , Dec 31, 2021(1,194)79576138104(123)

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Jun 22, 2024

A partially completed pension spreadsheet showing the relationships among the elements that constitute Carney, Inc.'s defined benefit pension plan follows. Six years earlier, Carney revised

A partially completed pension spreadsheet showing the relationships among the elements that constitute Carney, Inc.'s defined benefit pension plan follows. Six years earlier, Carney revised its pension formula and recalculated benefits earned by employees in prior years using the more generous formula. The prior service cost created by the recalculation is being amortized at the rate of $4 million per year. At the end of 2021, the pension formula was amended again, creating an additional prior service cost of $30 million. The expected rate of return on assets and the actuary's discount rate were 10%, and the average remaining service life of the active employee group is 10 years.

Required:

Fill in the missing amounts.
Prepare the 2021 journal entry to record pension expense.
Prepare the journal entry(s) to record any 2021 gains and losses and new prior service cost in 2021.
Prepare the 2021 journal entries to record (a) the cash contribution to plan assets and (b) the payment of retiree benefits

( )s indicate credits; debits otherwise($ in millions)PBOPlan AssetsPrior Service Cost-AOCINet Loss-AOCIPension ExpenseCashNet Pension (Liability) / AssetBalance, Jan. 1, 2021(950)900501050

(50)Service cost(94)

940

(94)

Interest cost(95)