Example information set for Test 2

Linguine Corporation has a defined benefit pension plan. Linguine received the following information for the current calendar year:

The expected long-term return on plan assets is 15%. Other relevant data for the year:

(1) As of January 1, the balance in AOCI-Net pension losses is $45,000,000, and the average remaining service life of active employees is 10 years.

(2) As of January 1, the balance in AOCI-Prior service cost is $16,000,000 due to a pension plan amendment made two years before, and the average remaining service life of affected employees is 4 years.

Required:

1. Calculate the pension expense for 2021
2. Prepare the JE(s) to record (a) pension expense, (b) gains or losses, (c) prior service cost, (d) funding, and (e) payment of benefits for 2021.
3. Any other JE(s)

$100,000,000 15,000,000 10,000,000 (8,000,000 $117,000,000 Projected benefit obligation Balance, January 1 Service cost Interest cost Benefits paid Balance, December 31 Plan assets Balance, January 1 Actual return on plan assets Contribution Benefits paid Balance. December 31 $60,000,000 7,000,000 16,000,000 (8,000,000 $75.000.000 $100,000,000 15,000,000 10,000,000 (8,000,000 $117,000,000 Projected benefit obligation Balance, January 1 Service cost Interest cost Benefits paid Balance, December 31 Plan assets Balance, January 1 Actual return on plan assets Contribution Benefits paid Balance. December 31 $60,000,000 7,000,000 16,000,000 (8,000,000 $75.000.000