APB Opinion No

question 7

Multiple Choice

APB Opinion No. 8 set minimum and maximum limits on the annual provision for pension cost. An amount that was always included in the calculation of both the minimum and the maximum limit is

• A) Normal cost
• B) Amortization of past service cost
• C) Interest on unfunded past and prior service costs
• D) Retirement benefits paid

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Definitions:

Accounts Payable

Liabilities owed by a business to its suppliers or vendors for goods and services purchased on credit.

Dividends

Portions of a company's earnings paid out to shareholders as a reward for their investment.

FOB Destination

A shipping term indicating that the seller is responsible for goods and shipping costs until the goods reach the buyer's specified location.

Merchandise

Goods bought for the purpose of resale at a profit.