Electronic Distribution has a defined benefit pension plan. Characteristics of the plan during 2013 are as follows:
|
($ millions) |
| PBO balance, January 1 |
|
$530 |
| Plan assets balance, January 1 |
|
300 |
| Service cost |
|
50 |
| Interest cost |
|
30 |
| Gain from change in actuarial assumption |
|
36 |
| Benefits paid |
|
(46) |
| Actual return on plan assets |
|
23 |
| Contributions 2013 |
|
40 |
|
|
The expected long-term rate of return on plan assets was 9%. There were no AOCI balances related to pensions on January 1, 2013, but at the end of 2013, the company amended the pension formula creating a prior service cost of $18 million. Assume Electronic Distribution prepares its financial statements according to International Financial Reporting Standards. Also assume that 10% is the current interest rate on high-quality corporate bonds.
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| 1. |
Calculate the net pension cost for 2013, separating its components into appropriate categories for reporting. (Enter your answers in millions (i.e., 10,000,000 should be entered as 10).)
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|
|
($ in millions) |
| Service cost |
|
| Net interest cost |
|
| Remeasurement gain from assumption change |
|
| Remeasurement loss on plan assets |
|
| Net pension cost |
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|