Merciful Industries has a beginning PBO balance of $600,000 and a settlement rate of 6%. As a result of an amendment to the current union contract, there are prior service costs of $52,000. What is the journal entry to record interest expense on the pension obligation?

A. Pension Expense - 36,000

Other Comprehensive Income - 36,000

B. Pension Expense - 39,120

Projected Benefit Obligation - 39,120

C. Pension Expense - 130,400

Projected Benefit Obligation - 130,400

D. Pension Expense - 48,880

Other Comprehensive Income - 48,880