On December 31, 2018, the following pension-related data were available for CPS Industries' noncontributory, defined benefit pension plan:
Projected Benefit Obligation |
($ in millions) |
Balance, January 1, 2018 |
$960 |
Service cost |
164 |
Interest cost, discount rate, 5% |
48 |
Gain due to changes in actuarial assumptions in 2018 |
(20) |
Pension benefits paid |
(80) |
Balance, December 31, 2018 |
$1,072 |
Plan Assets |
|
Balance, January 1, 2018 |
$1,000 |
Actual return on plan assets |
80 |
(Expected return on plan assets, $90) |
|
Cash contributions |
140 |
Pension benefits paid |
(80) |
Balance, December 31, 2018 |
$1,140 |
January 1, 2018, balances: |
|
Prior service cost (amortization $16 per year) |
$96 |
Net gain (any amortization over 15 years) |
160 |
Required:
1) Prepare the 2018 journal entry to record pension expense.
2) How will the statement of comprehensive income be affected by any 2018 gains and losses?
1) Journal Entry
Pension expenses ----------------------------Dr $ 164
Interest expenses employee benefits ----Dr $48
Pension fund liability -----------------------Cr $192
2) Statement of comprehensive income
The impact on statement of comprehensive income is that the P&L to be debited by $ 192
On December 31, 2018, the following pension-related data were available for CPS Industries' noncontributory, defined benefit...
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