FASB Statement No

question 21

Multiple Choice

FASB Statement No. 87 states that prior service cost should be

• A) offset against current service cost.
• B) recognized in the period of plan adoption or amendment.
• C) amortized over the expected service period.
• D) recorded as a prior period adjustment.

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Definitions:

Ethical Action

Behavior guided by moral principles, aiming to promote good and avoid harm.

Principle of Utility

A fundamental concept in utilitarian ethics that suggests actions should be judged as right or wrong based on their outcomes, specifically their ability to produce the greatest happiness for the greatest number of people.

Greatest Happiness

A principle that suggests the best action is the one that maximizes happiness or pleasure for the greatest number of people.

Associated Pleasure

The enjoyment or satisfaction derived from a particular activity, object, or association.