The Following Are Key Terms in Chapter 8 That Relate

question 26

Short Answer

The following are key terms in Chapter 8 that relate to accounting for pension plans.
A.Agent multiple-employer pension plan
B.Cost-sharing multiple-employer pension plan
C.Covered payroll
D.Defined benefit plan
E. Defined contribution plan
F. Net pension liability
G.Service cost
H.Total pension liability
For each of the following definitions,indicate the key term from the list above that best matches by placing the appropriate letter in the blank space next to the definition.
_____ 1. A pension plan which specifies the amount or rate of contribution that the employer and employees must contribute to the members' accounts in the pension plan.
_____ 2. The portion of the present value of projected benefit payments to be provided through the pension plan to current active and inactive employees that is attributed to those employees' past periods of service.
_____ 3. The portion of the actuarial present value of projected benefit payments that is attributed to the current year,interest on the total pension liability,benefit payments,and other changes to the total pension liability.
_____ 4. The pension obligations of many employers are pooled and plan assets can be used to pay the benefits of the employees of any employer that provides pensions through the pension plan.
_____ 5. Plan assets of numerous employers are pooled for investment purposes but accounts are maintained for the individual employer participants.
A. Agent multiple-employer pension plan
B. Cost-sharing multiple-employer pension plan
C. Covered payroll
D. Defined benefit plan
E. Defined contribution plan

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Definitions:

Industry Supply Curve

A graphical representation that shows the relationship between the price of a good and the total output of that good by all firms in the industry.

Marginal Cost Curve

A graphical representation showing how the cost of producing one additional unit of a good varies as production volume changes.

Raw Materials

The basic materials from which products are manufactured or made.

Average Total Cost

The total cost of production divided by the quantity produced, encompassing both fixed and variable costs to provide a per-unit cost basis.