Answer:
$110,000
Explanation:
There is pension liability for a corporation when the the projected benefit obligation (PBO) is greater than the fair value of plan assets. Therefore, pension liability is obtained by simply deducting the fair value of plan assets from the PBO as follows:
Pension liability = $400,000 - $290,000 = $110,000
Therefore, Nome should report $110,000 as pension liability in its September 30, year 2 balance sheet.