Lacy Construction has a noncontributory, defined benefit pension plan. At December 31, 2024, Lacy received the...

 

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Lacy Construction has a noncontributory, defined benefit pension plan. At December 31, 2024, Lacy received the following information: ($ in millions) Projected Benefit Obligation Balance, January 1 Service cost Prior service cost Interest cost (5.0%) Benefits paid Balance, December 31 Plan Assets Balance, January 1 Actual return on plan assets Contributions 2024 Benefits paid Balance, December 31 $ 1,120 90 42 56 (80) $ 1,228 ($ in millions) $ 530 56 90 (80) $ 596 The expected long-term rate of return on plan assets was 10%. There were no AOCI balances related to pensions on January 1, 2024. At the end of 2024, Lacy amended the pension formula creating a prior service cost of $42 million. Required: 1. Determine Lacy's pension expense for 2024. 2. Prepare the journal entry(s) to record Lacy's (a) pension expense, (b) gains or losses, (c) prior service cost, (d) funding, and (e) payment of retiree benefits for 2024. Lacy Construction has a noncontributory, defined benefit pension plan. At December 31, 2024, Lacy received the following information: ($ in millions) Projected Benefit Obligation Balance, January 1 Service cost Prior service cost Interest cost (5.0%) Benefits paid Balance, December 31 Plan Assets Balance, January 1 Actual return on plan assets Contributions 2024 Benefits paid Balance, December 31 $ 1,120 90 42 56 (80) $ 1,228 ($ in millions) $ 530 56 90 (80) $ 596 The expected long-term rate of return on plan assets was 10%. There were no AOCI balances related to pensions on January 1, 2024. At the end of 2024, Lacy amended the pension formula creating a prior service cost of $42 million. Required: 1. Determine Lacy's pension expense for 2024. 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 2024.

Answer rating: 100% (QA)

1 To determine Lacys pension expense for 2024 we can use the following formula Pension Expense Servi... View the full answer