Which of the Following Statements Regarding Defined Benefit Plans Is

question 101

Multiple Choice

Which of the following statements regarding defined benefit plans is false?

• A)The benefits are based on a fixed formula.
• B)The vesting period can be based on a graded or cliff schedule.
• C)Employees bear the investment risks of the plan.
• D)Employers are generally required to make annual contributions to meet expected future liabilities.

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Definitions:

Finished Goods

Manufactured items that are completed and ready for sale but have not yet been sold to customers.

Raw Materials

Primary components or substances used in the production of goods.

Direct Materials

Raw materials that are directly traceable to the manufacturing of a product and are a significant component of finished goods.

Work in Process Inventory

Work in process inventory includes partially completed goods that are still in the production process at the end of a period.