Question

Pension data for Sterling Properties include the following: ($in 000) $110 550 600 Service cost, 2018 Projected benefit obligation, January 1, 2018 Plan assets (fair value), January 1, 2018 Prior service cost-AOCI (2018 amortization, $9) Net loss-AOCI (2018 amortization. $2) Interest rate, 66 Expected return on plan assets, 10 Actual return on plan assets, 116 84 105 Required: Determine pension expense for 2018. (Enter your answers in thousands. Amounts to be deducted should be indicated with a minus sign.) Pension Expense Pension expense

Answer 1

Calculation of Pension Expense
	$ in 000s
Service Cost	110.00
Interest cost (6% x $550)	33.00
Expected return on the plan assets	(60.00)
Amortization of prior service cost	9.00
Amortization of net loss	2.00
Pension Expense	94.00
Explanation
Expected return on the plan assets
Actual                                                           = 66 (600*11%)
Less: Gain                                                    =   6 (600*11%) - (600*10%)
Expected return on the plan assets = 60