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Exercise 17-25 (Static) Postretirement benefits; determine APBO, service cost, interest cost; prepare journal entry [LO17-10, 17-11] The following data are available pertaining to Household Appliance
Exercise 17-25 (Static) Postretirement benefits; determine APBO, service cost, interest cost; prepare journal entry [LO17-10, 17-11]
The following data are available pertaining to Household Appliance Company's retiree health care plan for 2024: Number of employees covered 2 Years employed as of January 1, 2024 3 [each] Attribution period 25 years Expected postretirement benefit obligation, January 1 $ 50,000 Expected postretirement benefit obligation, December 31 $ 53,000 Interest rate 6 % Funding none
Required:
- What is the accumulated postretirement benefit obligation at the beginning of 2024?
- What is interest cost to be included in 2024 postretirement benefit expense?
- What is service cost to be included in 2024 postretirement benefit expense?
- Prepare the journal entry to record the postretirement benefit expense for 2024.
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