Which Statement Correctly Identifies a Benefit or a Drawback of a Company

question 88

Multiple Choice

Which statement correctly identifies a benefit or a drawback of a company offering its employees a pension plan compared to a retirement savings program with some employer matching of savings?

• A) A company's obligation to an employee's retirement savings plan is met completely by the time the employee retires. A company maintains an annual obligation to an employee's pension until the former employee dies.
• B) A company's obligation to an employee's pension is met completely by the time the employee retires. A company maintains an annual obligation to an employee's retirement savings plan until the former employee dies.
• C) Pensions typically increase annually with cost-of-living-adjustments (COLAs), while the payout of a retirement savings plan will never have an annual increase.
• D) A company can delay its costs for retirement savings until an employee retires, but it must make annual contributions to a pension fund during an employee's working years.

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