Work Assignment $1$

Intermediate Corporation provides its employees with a defined benefit pension plan and post$-$retirement health care plan. As an accountant working for the CFO at Intermediate Corporation, you are responsible for calculating and reporting the appropriate expenses, creating needed journal entries, and computing and justifying all income statement and balance sheet numbers for the December $31,2024,$ annual financial statements. The company follows U$.$S$.$ GAAP.

Data from the Accounting Records

Checking the post$-$retirement data for Intermediate, you find that on January $1,2024,$ the projected benefit obligation $($PBO$)$ was $$7,200,000,$ and the APBO was $$5,000,000.$ You also note that the Accumulated Other Comprehensive Income account has an unrecognized pension prior service cost of $$800,000$ and an unrecognized net actuarial gain of $$400,000.$ The average remaining service life of employees who received benefits from the prior service cost is $10$ years. Denton State Bank Pension Plan Trustee Report

The pension trust started $2024$ with a balance of $$10,800,000.$ The expected rate of return on plan assets for $2024$ is $6\%.$ The balance on December $31,2024,$ in the Pension Trust Fund is $$11,456,000.$ Intermediate made contributions to the pension plan during $2024$ totaling $$450,000,$ and the trustee paid benefits of $$550,000$ to retirees.

Actuary Report for $2024$

Early in January $2025,$ Intermediate received the $2024$ annual report from Actuaries $$R Us$.$ This included a computation of service cost for the year as $$700,000$ using a discount rate of $5\%.$ Changes in actuarial assumptions from the end of $2023$ through $2024$ resulted in a gain of $$150,000.$ The service cost related to the post$-$retirement health care plan was $$900,000,$ and the discount rate used was $5\%.$