Question
Teal Co. provides the following information about its postretirement benefit plan for the year 2020. Service cost $83,900 Prior service cost amortization 3,100 Contribution to
Teal Co. provides the following information about its postretirement benefit plan for the year 2020.
Service cost $83,900
Prior service cost amortization 3,100
Contribution to the plan 51,000
Actual and expected return on plan assets 67,100
Benefits paid 42,700
Plan assets at January 1, 2020 697,300
Accumulated postretirement benefit obligation at January 1, 2020 756,400
Accumulated OCI (PSC) at January 1, 2020 103,300 Dr.
Discount rate 8%
Compute the post retirement benefit expense for 2020.
Post retirement benefit expense: ????
**The answer below was previously provided by another tutor and it was incorrect. Please provide a different explanation/answer**
Computation of Post Retirement Benefit Expenses for 2020:
Post Retirement Benefit Expense = Service Cost + Interest on post retirement benefit obligation - Actual and Expected return on plan assets
Post retirement benefit expense = $83,900 + [$103,300 * 8% ] - $67,100
Post retirement benefit expense = $25,064 (this is incorrect)
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