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Lacy Construction has a noncontributory, defined benefit pension plan. At December 31, 2021, Lacy received the following information: ($ in millions) $600 64 16 36 (47) Projected Benefit Obligation Balance, January 1 Service cost Prior service cost Interest cost (6.0%) Benefits paid Balance, December 31 Plan Assets Balance, January 1 Actual return on plan assets Contributions 2021 Benefits paid Balance, December 31 $669 ($ in millions) $270 29 64 (47) $316 The expected long-term rate of return on plan assets was 10%. There were no AOCI balances related to pensions on January 1, 2021. At the end of 2021, Lacy amended the pension formula creating a prior service cost of $16 million. Required: 1. Determine Lacy's pension expense for 2021. 2. Prepare the journal entry(s) to record Lacy's (a) pension expense, (b) gains or losses, (c) prior service cost, (d) funding, and (e) payment of retiree benefits for 2021.

Lacy Construction has a noncontributory, defined benefit pension plan. At December 31, 2021, Lacy received the following information: ($ in millions) $600 64 16 36 (47) Projected Benefit Obligation Balance, January 1 Service cost Prior service cost Interest cost (6.0%) Benefits paid Balance, December 31 Plan Assets Balance, January 1 Actual return on plan assets Contributions 2021 Benefits paid Balance, December 31 $669 ($ in millions) $270 29 64 (47) $316 The expected long-term rate of return on plan assets was 10%. There were no AOCI balances related to pensions on January 1, 2021. At the end of 2021, Lacy amended the pension formula creating a prior service cost of $16 million. Required: 1. Determine Lacy's pension expense for 2021. 2. Prepare the journal entry(s) to record Lacy's (a) pension expense, (b) gains or losses, (c) prior service cost, (d) funding, and (e) payment of retiree benefits for 2021.

Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter19: Accounting For Post Retirement Benefits
Section: Chapter Questions
Problem 4E
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K ces Lacy Construction has a noncontributory, defined benefit pension plan. At December 31, 2021, Lacy received the following information: ($ in millions) $600 64 16 36 (47) Projected Benefit Obligation Balance, January 1 Service cost Prior service cost Interest cost (6.0%) Benefits paid Balance, December 31 Plan Assets Balance, January 1 Actual return on plan assets Contributions 2021 Benefits paid Balance, December 31 $ 669 ($ in millions) $270 29 64 (47) $316 The expected long-term rate of return on plan assets was 10%. There were no AOCI balances related to pensions on January 1, 2021. At the end of 2021, Lacy amended the pension formula creating a prior service cost of $16 million. Required: 1. Determine Lacy's pension expense for 2021. 2. Prepare the journal entry(s) to record Lacy's (a) pension expense, (b) gains or losses, (c) prior service cost, (d) funding, and (e) payment of retiree benefits for 2021. Complete this question by entering your answers in the tabs below.
Transcribed Image Text:K ces Lacy Construction has a noncontributory, defined benefit pension plan. At December 31, 2021, Lacy received the following information: ($ in millions) $600 64 16 36 (47) Projected Benefit Obligation Balance, January 1 Service cost Prior service cost Interest cost (6.0%) Benefits paid Balance, December 31 Plan Assets Balance, January 1 Actual return on plan assets Contributions 2021 Benefits paid Balance, December 31 $ 669 ($ in millions) $270 29 64 (47) $316 The expected long-term rate of return on plan assets was 10%. There were no AOCI balances related to pensions on January 1, 2021. At the end of 2021, Lacy amended the pension formula creating a prior service cost of $16 million. Required: 1. Determine Lacy's pension expense for 2021. 2. Prepare the journal entry(s) to record Lacy's (a) pension expense, (b) gains or losses, (c) prior service cost, (d) funding, and (e) payment of retiree benefits for 2021. Complete this question by entering your answers in the tabs below.
7 Complete this question by entering your answers in the tabs below. Reque Required 1 Required 2 Determine Lacy's pension expense for 2021. Pension expense Requirgo Journal entry worksheet CDE Record the pension expense. Prepare the journal entry(s) to record Lacy's (a) pension expense, (b) gains or losses, (c) prior service cost, (d) funding, and (e) payment of retiree benefits for 2021. (If no entry is required for a transaction/event, select "No journal entry required in the first account field. Enter your answers in millions. (.e., 10,000,000 should be entered as 10).) View transaction list Note: Enter debits before credits. million Transaction A Record entry General Journal Required 1 Clear entry Required 2 > Debit Credit > View general journal
Transcribed Image Text:7 Complete this question by entering your answers in the tabs below. Reque Required 1 Required 2 Determine Lacy's pension expense for 2021. Pension expense Requirgo Journal entry worksheet CDE Record the pension expense. Prepare the journal entry(s) to record Lacy's (a) pension expense, (b) gains or losses, (c) prior service cost, (d) funding, and (e) payment of retiree benefits for 2021. (If no entry is required for a transaction/event, select "No journal entry required in the first account field. Enter your answers in millions. (.e., 10,000,000 should be entered as 10).) View transaction list Note: Enter debits before credits. million Transaction A Record entry General Journal Required 1 Clear entry Required 2 > Debit Credit > View general journal
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