Fox Company received the following reports of its defined benefit pension plan for the current calendar year:
|
PBO
|
|
Plan assets
|
|
|
Balance, January 1
|
$600,000
|
Balance, January 1
|
$500,000
|
|
Service cost
|
360,000
|
Actual return
|
50,000
|
|
Interest cost
|
64,000
|
Annual contribution
|
220,000
|
|
Benefits paid
|
(90,000)
|
Benefits paid
|
(90,000)
|
|
Balance, December 31
|
$934,000
|
Balance, December 31
|
$680,000
|
The long-term expected rate of return on plan assets is 8%. Assuming no other data are relevant, what is the pension expense for the year?
A. $360,000.
B. $424,000.
C. $374,000.
D. $384,000.