Defined benefit pension plan basics

Reference no: EM13144868

Louie Company has a defined benefit pension plan. On December 31 (the end of the fiscal year), the company received the PBO report from the actuary. The following information was included in the report: ending PBO, $110,000; benefits paid to retirees, $12,000; interest cost, $8,000. The discount rate applied by the actuary was 8%. What was the service cost for the year?

a) $ 14,000.

b) $12,000.

c) $18,000.

d) $92,000.

Reference no: EM13144868

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