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Two Reasons Why the Social Security System Nearly Went Bankrupt

question 121

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Two reasons why the Social Security system nearly went bankrupt in the early 1980s are: (i) wages were indexed but benefits were not; (ii) the percentage of elderly people in the country declined.


Definitions:

Production

The process of creating goods and services.

Accounting Period

A specific time frame for which financial accounting records are kept, closing with a balance sheet.

Process Cost System

A type of cost system that accumulates costs for each of the various departments within a manufacturing facility.

Job Order

An order for products or services issued by a company to manage production or service tasks as per client requirements.

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