Lacy Construction has a noncontributory, defined benefit pension plan. At December 31, 2021, Lacy received the following information:

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 $12 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,

(e) payment of retiree benefits for 2021.

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($ in millions) $360 Projected Benefit Obligation Balance, January 1 Service cost 60 Prior service cost 12 Interest cost (7.5%) Benefits paid 27 (37) $422 Balance, December 31 Plan Assets $240 Balance, January 1 Actual return on plan assets 27 Contributions, 2021 60 Benefits paid (37) $290 Balance, December 31