Question

14 Check my work The following information applies to the questions displayed below Actuary and trustee reports indicate the following changes in the P8O and plan assets of Lakeside Cable during 2018: art 3 of 7 Prior service cost at Jan. 1, 2018, from plan anendment at the beginning of 2016 (amortization: $6 million per year) Net loss-pensions at Jan.1, 2018 (previous losses exceeded previous gains) Average remaining service life of the active employ Actuary's discount rate $40 million $58 nil1ion 10 years ee group ints 10 ($ in millions) eBook Print Plan $200 18 РВО Beginning of 2018 Service cost Interest cost, 108 Loss (gain) on PBO Less: Retiree benefits End of 2018 $380 Beginning of 20118 6 Return on plan assets 8 9.0 (108 expected) (2) cash contributions 42) Less: Retiree benefits 430 End of 2018 64 42) $240 Problem 17-16 Part 3 3. Prepare a pension spreadsheet to assist you in determining end of 2018 balances in the PBO, plan assets, prior service cost-AOCI, the net loss-AOCI, and the pension liability. (Enter your answers in millions (i.e.. 10,000,000 should be entered as 10). Enter credit amounts with a minus sign and debit amounts with a positive sign.) < Prey 14 15 16 18 of 20 Next >

Answer 1

	PBO	Plan Assets	Prior service cost - AOCI	Net loss - AOCI	Pension expense	Cash	Net pension (liability)/Asset
Bal., Jan. 1, 2018	(380)	200	40	58			(180)
Service cost	(56)				56		(56)
Interest cost, 10%	(38)				38		(38)
Expected return on assets		20			(20)		20
Loss on assets		(2)		2			(2)
Amortization of:
Prior service cost – AOCI			(6)		6
Net loss – AOCI				(2)	2
Gain on PBO	2			(2)			2
Cash contributions		64				(64)	64
Retiree benefits	42	(42)
Bal., Dec. 31, 2018	(430)	240	34	56	82		(190)

380*10% = 38

200*10% = 20

Loss on assets = 20-18=2

Net loss – AOCI = (28-38)/10 years = 2