Payne, Inc., a nonpublicly traded company, implemented a defined benefit pension plan for its employees on January 2, 2006. The following data are provided for 2006, as of December 31, 2006:

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Accumulated benefit obligation

$103,000

Plan assets at fair value

78,000

Net periodic pension cost

90,000

Employer’s contribution

70,000

Assuming that the company has not elected to early adopt SFAS 158, what amount should Payne record as additional minimum pension liability at December 31, 2006?

  1. $0
  2. $ 5,000
  3. $20,000
  4. $45,000