Exercise 17-19 (Static) Record pension expense, funding, and gains and losses; financial statement effects [LO17-6, 17-7, 17-8]

Beale Management has a noncontributory, defined benefit pension plan. On December 31, 2024 (the end of Beale's fiscal year), the following pension-related data were available:

Projected Benefit Obligation ($ in millions) Balance, January 1, 2024 $ 480 Service cost 82 Interest cost, discount rate, 5% 24 Gain due to changes in actuarial assumptions in 2024 (10) Pension benefits paid (40) Balance, December 31, 2024 $ 536 Plan Assets ($ in millions) Balance, January 1, 2024 $ 500 Actual return on plan assets 40 (Expected return on plan assets, $45) Cash contributions 70 Pension benefits paid (40) Balance, December 31, 2024 $ 570 January 1, 2024, balances: ($ in millions) Pension asset $ 20 Prior service costAOCI (amortization $8 per year) 48 Net gainAOCI (any amortization over 15 years) 80

Required:

1. to 3. Prepare the journal entries required for the pension during 2024.

4. Determine the balances at December 31, 2024, in the net gainAOCI, and prior service costAOCI. [Hint: You might find T-accounts useful.]

5. What amount will Beale report in its 2024 balance sheet as a net pension asset or net pension liability for the funded status of the plan?