Question-
Foster Corporation received the following report from its actuary at the end of the year:
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December 31, 2012
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December 31, 2013
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Projected benefit obligation
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$1,800,000
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$2,000,000
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Accumulated benefit obligation
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1,300,000
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1,480,000
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Fair value of pension plan assets
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1,380,000
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1,440,000
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The amount reported as the pension liability on Foster's balance sheet at December 31, 2012 is
a. $0.
b. $400,000.
c. $420,000.
d. $500,000.
Additional information-
The problem relates to Basics Accounting and estimate the pension liability according to the balance sheet.