USE THE FOLLOWING INFORMATION FOR # 11-20:
Interest (Cost) Rate
2%
Expected rate of return on plan assets
4%
Actual rate of return on plan assets
5%
Beginning of year balance in CASH
$ 125,000
Projected benefit obligation at the beginning of 2017
$ 367,500
Service cost, 2017
$ 35,500
Interest Cost
Loss (gain) on PBO for assumption changes
$ 3,500
Less: Benefits paid to retirees during the year
$ (45,000)
Projected benefit obligation at the end of 2017
Plan assets at the beginning of the year
$ 295,000
Actual return on plan assets
$ 44,000
Cash contributions to the pension plan in 2017
Less: Benefits paid to retirees during the year
Plan assets at the end of 2017
Additional information reported from the actuary and plan trustee:
Prior Service Costs incurred beginning of 2016
$ 32,500
Beginning of year balance in AOCI for Net Loss
$ 43,750
Average remaining service years of employees
7 years
Beginning of year balance in AOCI for PSC
$ 28,450
Amortization of PSC
Amortization of net loss
Expected return on plan assets
11.) Calculate the 2017 Interest cost and write the answer on the cover sheet.
