Carpenter Gems Began the Year with a Net Pension Liability

question 130

Essay

Carpenter Gems began the year with a net pension liability of $84 million (underfunded pension plan). Pension expense for the year included the following ($ in millions): service cost, $30; interest cost, $18; expected return on assets, $12; amortization of net loss, $6.
Required:
Prepare the appropriate general journal entry to record Carpenter's pension expense.

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Definitions:

Credit

An accounting entry that increases the balance of liabilities and equity accounts, and decreases the balance of an asset or expense account.

Rent Expense

The cost incurred for renting a property or equipment, recognized as an expense on the income statement.

Debit Cash

An accounting entry that increases the cash balance in a company's books, indicating inflows of money or equivalent.

Credit Cash

An accounting entry that decreases the cash balance in the company’s books, often as a result of paying out cash for expenses or liabilities.