Question
Electronic Distribution has a defined benefit pension plan. Characteristics of the plan during 2016 are as follows: ($ millions) PBO balance, January 1 $ 560
Electronic Distribution has a defined benefit pension plan. Characteristics of the plan during 2016 are as follows: |
($ millions) | ||
PBO balance, January 1 | $ | 560 |
Plan assets balance, January 1 | 450 | |
Service cost | 65 | |
Interest cost | 45 | |
Gain from change in actuarial assumption | 20 | |
Benefits paid | (52) | |
Actual return on plan assets | 29 | |
Contributions 2016 | 55 | |
The expected long-term rate of return on plan assets was 8%. There were no AOCI balances related to pensions on January 1, 2016, but at the end of 2016, the company amended the pension formula creating a prior service cost of $12 million. (Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) |
Required: | |||||
1. | Calculate the pension expense for 2016.
|
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started