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Lacy Construction has a noncontributory, defined benefit pension plan. At December 31, 2016, Lacy received the following information: ($ in millions) $360 60 12 Projected
Lacy Construction has a noncontributory, defined benefit pension plan. At December 31, 2016, Lacy received the following information: ($ in millions) $360 60 12 Projected Benefit Obligation Balance, January 1 Service cost Prior service cost Interest cost (7.5%) Benefits paid Balance, December 31 Plan Assets Balance, January 1 Actual return on plan assets Contributions 2016 Benefits paid Balance, December 31 27 (37) $422 $240 27 60 (37) $290 The expected long-term rate of return on plan assets was 10%. There were no AOCI balances related to pen- sions on January 1, 2016. At the end of 2016, Lacy amended the pension formula creating a prior service cost of $12 million. Required: 1. Determine Lacy's pension expense for 2016. 2. Prepare the journal entry(s) to record Lacy's pension expense, gains or losses, prior service cost, funding, and payment of retiree benefits for 2016
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