In attempting to reconcile amounts reported in the disclosure note with amounts reported in the income statement and balance sheet, Barlow became confused. He was able to find the pension expense on the income statement but was unable to make sense of the balance sheet amounts. Expressing his frustration to his wife, Barlow said, It appears to me that the company has calculated pension expense as if they have the pension liability and pension assets they include in the note, but I can't seem to find those amounts in the balance sheet. In fact, there are several amounts here I can't seem to account for. They also say they've made some assumptions about interest rates, pay increases, and profits on invested assets. I wonder what difference it would make if they assumed other numbers,

Assume the role of Barlow's wife. Answer the following questions for your husband.

Is Barlow's observation correct that the company has calculated pension expense on the basis of amounts not reported in the balance sheet?

What amount would the company report as a pension liability in the balance sheet?

What amount would the company report as a pension asset in the balance sheet?

Which of the other amounts reported in the disclosure note would the company report in the balance sheet?

The disclosure note reports a net actuarial gain as well as an actuarial loss. How are these related? What do the amounts mean?

Which components of the pension expense represent deferred recognition? Where are these deferred amounts reported prior to amortization?