Question
The following information applies to the questions displayed below.] Actuary and trustee reports indicate the following changes in the PBO and plan assets of Lakeside
The following information applies to the questions displayed below.] Actuary and trustee reports indicate the following changes in the PBO and plan assets of Lakeside Cable during 2021:
Prior service cost at Jan. 1, 2021, from plan amendment at the beginning of 2019 (amortization: $4 million per year) | $ | 32 | million |
Net loss-pensions at Jan.1, 2021 (previous losses exceeded previous gains) | $ | 40 | million |
Average remaining service life of the active employee group | 10 | years | |
Actuarys discount rate | 8 | % | |
($ in millions)
PBO | Plan Assets | ||||||||
Beginning of 2021 | $ | 300 | Beginning of 2021 | $ | 200 | ||||
Service cost | 48 | ||||||||
Interest cost, 8% | 24 | Return on plan assets, 7.5% (10% expected) | 15 | ||||||
Loss (gain) on PBO | (2 | ) | Cash contributions | 45 | |||||
Less: Retiree benefits | (20 | ) | Less: Retiree benefits | (20 | ) | ||||
End of 2021 | $ | 350 | End of 2021 | $ | 240 | ||||
Assume the following actuary and trustee reports indicating changes in the PBO and plan assets of Lakeside Cable during 2022: ($ in millions)
PBO | Plan Assets | ||||||||
Beginning of 2022 | $ | 350 | Beginning of 2022 | $ | 240 | ||||
Service cost | 38 | ||||||||
Interest cost at 8% | 28 | Return on plan assets, 15% (10% expected) | 36 | ||||||
Loss (gain) on PBO | 5 | Cash contributions | 30 | ||||||
Less: Retiree benefits | (16 | ) | Less: Retiree benefits | (16 | ) | ||||
End of 2022 | $ | 405 | End of 2022 | $ | 290 | ||||
6. Using T-accounts, determine the balances at December 31, 2022, in the net lossAOCI and prior service costAOCI. (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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