The Schedule of Changes in Long-Term Obligations Contains an Account

question 57

Multiple Choice

The schedule of changes in long-term obligations contains an account "net pension obligation." Which of the following describes the event that gave rise to this account?

• A) The actual contribution by a proprietary fund was less than the annual required contribution per the actuary.
• B) The actual contribution by a governmental fund was less than the annual required contribution per the actuary.
• C) The actuarially computed pension liability exceeded the pension plan assets.
• D) The actuarially computed pension liability was less than the pension plan assets.

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Definitions:

Job Order Costing

An accounting method used to track costs and evaluate the profitability of custom jobs by accumulating the costs associated with a specific customer order.

Home Construction

The process of building residential homes, including planning, design, construction, and sale of new homes.

Prime Costs

The combination of direct materials and direct labor costs.

Direct Labor

The cost of wages for employees who are directly involved in the production of goods or services.