(Pension Terminology) The following items appear on Brueggen Company’s financial statements.
1. Under the caption Assets: Pension asset/liability.
2. Under the caption Liabilities: Pension asset/liability.
3. Under the caption Stockholders’ Equity: Prior service cost as a component of Accumulated Other Comprehensive Income.
4. On the income statement: Pension expense.
Explain the significance of each of the items above on corporate financial statements. (Note: All items set forth above are not necessarily to be found on the statements of a single company.)