Pearsall Company has a defined benefit pension plan. On December 31 (the end of the fiscal year), the company received the PBO report from the actuary. The following information was included in the report: ending PBO, $112,000; benefits paid to retirees, $11,500; interest cost, $6,500. The discount rate applied by the actuary was 10%. What was the service cost for the year? Multiple Choice $52,000. $5,000. $94,000. $18,000.
Pearsall Company has a defined benefit pension plan. On December 31 (the end of the fiscal year), the company received the PBO report from the actuary. The following information was included in the report: ending PBO, $112,000; benefits paid to retirees, $11,500; interest cost, $6,500. The discount rate applied by the actuary was 10%. What was the service cost for the year? Multiple Choice $52,000. $5,000. $94,000. $18,000.
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter19: Accounting For Post Retirement Benefits
Section: Chapter Questions
Problem 3MC
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Question
Pearsall Company has a defined benefit pension plan. On December 31 (the end of the fiscal year), the company received the PBO report from the actuary. The following information was included in the report: ending PBO, $112,000; benefits paid to retirees, $11,500; interest cost, $6,500. The discount rate applied by the actuary was 10%. What was the service cost for the year?
Multiple Choice
-
$52,000.
-
$5,000.
-
$94,000.
-
$18,000.
-
There is no correct answer.
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