Question
The following data are available pertaining to Household Appliance Company's retiree health care plan for 2016: Number of employees covered 2 Years employed as of
The following data are available pertaining to Household Appliance Company's retiree health care plan for 2016: |
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Number of employees covered |
| 2 |
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Years employed as of January 1, 2016 |
| 2 | [each] |
Attribution period |
| 25 | years |
Expected postretirement benefit obligation, Jan. 1 | $ | 65,000 |
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Expected postretirement benefit obligation, Dec. 31 | $ | 68,000 |
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Interest rate |
| 6 | % |
Funding |
| none |
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Required: |
1. | What is the accumulated postretirement benefit obligation at the beginning of 2016? |
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2. | What is interest cost to be included in 2016 postretirement benefit expense? |
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3. | What is service cost to be included in 2016 postretirement benefit expense? |
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4. | Prepare the journal entry to record the postretirement benefit expense for 2016. (If no entry is required for a particular event, select "No journal entry required" in the first account field.) |
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