On December 31, 2019, Tyre Corporation received the DBO report from the actuary. The following information was included in the report: ending DBO, $1,100,000; benefits paid to retirees, $100,000; interest cost, $80,000. The discount rate applied by the actuary was 8%. There was no actuarial revaluation required nor any past service cost. What was the service cost for the year?
On December 31, 2019, Tyre Corporation received the DBO report from the actuary. The following information was included in the report: ending DBO, $1,100,000; benefits paid to retirees, $100,000; interest cost, $80,000. The discount rate applied by the actuary was 8%. There was no actuarial revaluation required nor any past service cost. What was the service cost for the year?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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On December 31, 2019, Tyre Corporation received the DBO report from the actuary. The following information was included in the report: ending DBO, $1,100,000; benefits paid to retirees, $100,000; interest cost, $80,000. The discount rate applied by the actuary was 8%. There was no actuarial revaluation required nor any past service cost. What was the service cost for the year?
Select one:
a.
$20,000.
b.
$920,000.
c.
$180,000.
d.
$120,000.
e.
None of the above.
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