Webb Co., a nonpublicly traded company, implemented a defined benefit pension plan for its employees on January 1, 2003. During 2003 and 2004, Webb’s contributions fully funded the plan. The following data are provided for 2006 and 2005:
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|
2006 Estimated |
2005 Actual |
|
|
Projected benefit obligation, December 31 |
$750,000 |
$700,000 |
|
Accumulated benefit obligation, December 31 |
520,000 |
500,000 |
|
Plan assets at fair value, December 31 |
675,000 |
600,000 |
|
Projected benefit obligation in excess of plan assets |
75,000 |
100,000 |
|
Pension expense |
90,000 |
75,000 |
|
Employer’s contribution |
? |
50,000 |
What amount should Webb contribute in order to report an accrued pension liability of $15,000 in its December 31, 2006 balance sheet, assuming that the company has not early adopted SFAS 158?
- $ 50,000
- $ 60,000
- $ 75,000
- $100,000