ABC Has a Non-Contributory,defined Benefit Pension Plan

question 92

Multiple Choice

ABC has a non-contributory,defined benefit pension plan.Data for 2014 were as follows: Pension plan assets (at fair value) January 1,2014,$240,000,and December 31,2014,$285,000; APO,January 1,2014,$243,000 and December 31,2014,$345,000.The accrued pension obligation was underfunded at the end of 2014 in the amount of:

• A) $15,000.
• B) $30,000.
• C) $45,000.
• D) $60,000.

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Definitions:

Times Interest Earned

A metric used to measure a company's ability to meet its debt obligations, calculated by dividing earnings before interest and taxes (EBIT) by interest expenses.

Interest Expense

The cost incurred by an entity for borrowed funds over a specific period, including loans, bonds, or lines of credit.

Redeemable Bonds

Bonds that can be returned to the issuing entity before maturity for a predetermined price.