Pension data for Sterling Properties include the following: ($ in 000s) Service

Question

Pension data for Sterling Properties include the following: ($ in 000s) Service cost, 2016 $ 118 Projected benefit obligation, January 1, 2016 650 Plan assets (fair value), January 1, 2016 700 Prior service cost–AOCI (2016 amortization, $8) 85 Net loss–AOCI (2016 amortization, $1) 106 Interest rate, 8% Expected return on plan assets, 12% Actual return on plan assets, 13% Required: Determine pension expense for 2016. (Enter your answers in thousands. Amounts to be deducted should be indicated with a minus sign.)

Explanation / Answer

Answer: Calculation of the pension expense for 2016:

Service cost 118
Interest cost 52 (650*8%)
Expected return on the plan assets (84) (700*12%)
Amortization of PSC 8
Amortization of net loss 1
Pension expense 95

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