Answered step by step
Verified Expert Solution
Question
1 Approved Answer
[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: $6 million per year) Net loss-pensions at Jan.1, 2021 (previous losses exceeded previous gains) Average remaining service life of the active employee group Actuary's discount rate $50 million $60 million 10 years 8% ($ in millions) PBO Plan Assets $360 Beginning of 2021 Service cost Interest cost, 8% Loss (gain) on PBO Less: Retiree benefits End of 2021 $500 66 40 (4) (52) $550 Beginning of 2021 Return on plan assets, 7.5% (10% expected) Cash contributions Less: Retiree benefits End of 2021 27 65 (52) $400 Assume the following actuary and trustee reports indicating changes in the PBO and plan assets Lakeside Cable during 2022: ($ in millions) Plan PBO Assets $400 Beginning of 2022 Service cost Interest cost, 8% Loss (gain) on PBO Less: Retiree benefits End of 2022 $550 56 44 5 (34) $ 621 Beginning of 2022 Return on plan assets, 17% (10% expected) Cash contributions Less: Retiree benefits End of 2022 68 48 (34) $482 4-a. Determine Lakeside's pension expense for 2022. 4-b. Prepare the appropriate journal entries to record the expense, the cash funding of plan assets, and payment of benefits to retirees. [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: $6 million per year) Net loss-pensions at Jan.1, 2021 (previous losses exceeded previous gains) Average remaining service life of the active employee group Actuary's discount rate $50 million $60 million 10 years 8% ($ in millions) PBO Plan Assets $360 Beginning of 2021 Service cost Interest cost, 8% Loss (gain) on PBO Less: Retiree benefits End of 2021 $500 66 40 (4) (52) $550 Beginning of 2021 Return on plan assets, 7.5% (10% expected) Cash contributions Less: Retiree benefits End of 2021 27 65 (52) $400 Assume the following actuary and trustee reports indicating changes in the PBO and plan assets Lakeside Cable during 2022: ($ in millions) Plan PBO Assets $400 Beginning of 2022 Service cost Interest cost, 8% Loss (gain) on PBO Less: Retiree benefits End of 2022 $550 56 44 5 (34) $ 621 Beginning of 2022 Return on plan assets, 17% (10% expected) Cash contributions Less: Retiree benefits End of 2022 68 48 (34) $482 4-a. Determine Lakeside's pension expense for 2022. 4-b. Prepare the appropriate journal entries to record the expense, the cash funding of plan assets, and payment of benefits to retirees
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started