60 Problem 3. Amortization of prior service cost using years-of-service method. On January 1, 2016. Solano Incorporated amended its pension plan which caused an increase of $6,000,000 in its projected benefit obligation. The company has 400 employees who are expected to receive benefits under the company's defined benefit pension plan. The personnel department provided the following information regarding expected employee retirements: Number of Employees Expected Retirements on December 31 40 2016 120 2017 2018 160 2019 2020 400 The company plans to use the years-of-service method in calculating the amortization of prior service cost as a component of pension expense. Instructions Prepare a schedule which shows the amount of annual prior service cost amortization that the company will recognize as a component of pension expense from 2016 through 2020. k20-1