TB Problem 17-198 (Algo)

Oberon Company provides postretirement health care benefits to employees who provide at least 10 years of service and reach the age of 65 while in service. On January 1 of the current year, the following plan-related data were available.

Net losspostretirement benefit plan	$	10,750,000
APBO balance	$	104,700,000
Fair value of plan assets		none
Average remaining service period to retirement		20	years
Average remaining service period to full eligibility		15	years

On January 1 of the current year, Oberon amended the plan to provide dental benefits. The actuary determines that the cost of making the amendment increases the APBO by $11,100,000. Management chooses to amortize this amount on a straight-line basis. The service cost is $67,000,000. The appropriate interest rate is 10%. Required: Calculate the postretirement benefit expense for the current year.