Nome Co. sponsors a defined benefit plan covering all employees. Benefits are based on years of service and compensation levels at the time of retirement. Nome determined that, as of September 30, 2006, its accumulated benefit obligation was $380,000, and its plan assets had a $290,000 fair value. Nome’s September 30, 2006 trial balance showed prepaid pension cost of $20,000. In its September 30, 2006 balance sheet, what amount should Nome report as additional pension liability? Assume that Nome is a nonpublicly traded company and has not elected to apply SFAS 158 in 2006.
- $110,000
- $360,000
- $380,000
- $400,000