Marrow Company has a defined benefit pension plan.Marrow received the following information from its actuaries for 2017:

Projected Benefit Obligation(in $million)

Balance, January 1260

Service cost40

Interest cost26

Benefits paid to retirees20

Plan Assets

Balance, January 1290

Actual return on plan assets22

Cash contribution to the plan by Marrow15

Benefits paid to retirees20

In addition, the following information is provided:

1.Based on historical experience, the expected return on the plan assets has been 10%.

2.The 2017 amortization of prior service costs is $8 million.Prior service cost was incurred in 2014 when the plan was amended.

3.There is no balance in the OCI gain/loss account at January 1, 2017.

Required:

1.Determine the pension expense for 2017.

2. Prepare the journal entries necessary to record the pension activity for the year.Specically, explain whether the pension plan is over or underfunded at the end of 2017