On January 2, 20X9, Loch Co. established a noncontributory defined benefit plan covering all employees and contributed $1,000,000 to the plan. At December 31, 20X9, Loch determined that the 20X9 service and interest costs on the plan were $620,000. The expected and the actual rate of return on plan assets for 20X9 was 10%. There are not other components of Loch's pension expense.
What amount should Loch report in its December 31, 20X9 balance sheet as prepaid pension cost?
a. $280,000
b. $380,000
c. $480,000
d. $620,000