Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Electronic Distribution has a defined benefit pension plan. Characteristics of the plan during 2021 are as follows: PBO balance, January 1 Plan assets balance,
Electronic Distribution has a defined benefit pension plan. Characteristics of the plan during 2021 are as follows: PBO balance, January 1 Plan assets balance, January 1 Service cost Interest cost Gain from change in actuarial assumption Benefits paid Actual return on plan assets Contributions 2021 (5 millions) $620 400 95 75 32 (64) 25 85 The expected long-term rate of return on plan assets was 8% There were no AOCI balances related to pensions on January 1, 2021, but at the end of 2021, the company amended the pension formula, creating a prior service cost of $18 million. Assume Electronic Distribution prepares its financial statements according to International Financial Reporting Standards (IFRS). Also assume that 10% is the current Interest rate on high-quality corporate bonds. Required: 1. Calculate the net pension cost for 2021, separating its components Into appropriate categories for reporting 2. Prepare the journal entries to record (a) the components of net pension cost, (bigains or losses, (c) past service cost, (d) funding, and (e) payment of benefits for 2021. 3. What amount will Electronic Distribution report in its 2021 balance sheet as a net pension asset or net pension lability? Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Calculate the net pension cost for 2021, separating its components into appropriate categories for reporting. (Enter your answers in milions (ie, 10,000.000 should be entered as 10) Enter credit amounts with a minus sign and debit amounts with a positive sion.) Reported In Income statement Past service cost Service cost 2021 Service cost Not interest cost Reported as OCE Romansuramant gain from assumption change-OCE Remensurament loss on pan assots CC 9 00 (in millions) 620X S (32) 320 715 Net pension cost 3 215 Required 2 >
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