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I am needing some help with an accounting problem The Kollar Company has a defined benefit pension plan. Pension information concerning the fiscal years 2016
I am needing some help with an accounting problem
The Kollar Company has a defined benefit pension plan. Pension information concerning the fiscal years 2016 and 2017 are presented below ($ in millions): |
Information Provided by Pension Plan Actuary: |
a. | Projected benefit obligation as of December 31, 2015 = $3,200. |
b. | Prior service cost from plan amendment on January 2, 2016 = $600 (straight-line amortization for 10-year average remaining service period). |
c. | Service cost for 2016 = $640. |
d. | Service cost for 2017 = $690. |
e. | Discount rate used by actuary on projected benefit obligation for 2016 and 2017 = 10%. |
f. | Payments to retirees in 2016 = $500. |
g. | Payments to retirees in 2017 = $570. |
h. | No changes in actuarial assumptions or estimates. |
i. | Net gainAOCI on January 1, 2016 = $370. |
j. | Net gains and losses are amortized for 10 years in 2016 and 2017. |
Information Provided by Pension Fund Trustee: |
a. | Plan asset balance at fair value on January 1, 2016 = $2,300. |
b. | 2016 contributions = $660. |
c. | 2017 contributions = $710. |
d. | Expected long-term rate of return on plan assets = 12%. |
e. | 2016 actual return on plan assets = $210. |
f. | 2017 actual return on plan assets = $260. |
Required: | |
1. | Calculate pension expense for 2016 and 2017. (Do not round intermediate calculations. Enter your answers in millions rounded to 1 decimal place (i.e., 5,500,000 should be entered as 5.5).) |
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