If a Trust Is to Be Used for the Benefit

question 125

Multiple Choice

If a trust is to be used for the benefit individuals, private organizations or other governments, the following funds should be used:

• A) Special revenue fund.
• B) Permanent fund.
• C) Private purpose fund.
• D) Either A or B, depending upon whether the principal must be maintained.

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Definitions:

Pension Expense

The company's cost in a specific period for providing pension benefits to employees during that period.

Funding Agency

An organization that provides financial support for various projects or enterprises.

Unrecognized Prior Service Cost

Costs related to pension plan benefits that have been earned by employees in prior periods but have not yet been recognized in financial statements.

Pension Expense

The cost recognized in an accounting period related to an entity's pension plan, which includes service cost, interest cost, expected return on plan assets, and any amortization.