Question: 1. A company's postretirement health care benefit plan had an APBO of $280,000 on January 1, 2016. During 2016, retiree benefits paid were $41,500. The discount rate for the plan for this year was 10%. Service cost for 2016 was $83,000. Plan assets (fair value) increased during the year by $349,500. The amount of the APBO at December 31, 2016, was:
2. The estimated medical costs are expected to be $9,000 during an employee's retirement. The retiree is expected to pay 20% of the cost and Medicare is expected to pay 50% of the cost. What is the company's estimated net cost of benefits?