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Carla Vista, Inc. has a defined-benefit pension plan covering its 50 employees. Carla Vista agrees to amend its pension benefits. As a result, the projected
Carla Vista, Inc. has a defined-benefit pension plan covering its 50 employees. Carla Vista agrees to amend its pension benefits. As a result, the projected benefit obligation increased by $2475000. Carla Vista determined that all its employees are expected to receive benefits under the plan over the next 5 years. In addition, 10 employees are expected to retire or quit each year. Assuming that Carla Vista uses the years-of-service method of amortization for prior service cost, the amount reported as amortization of prior service cost in year one after the amendment is $165000. $495000. $577500. $825000. Click if you would like to Show Work for this question: Open Show Work
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