How Are the Accrued Benefits of a Defined Contribution Plan

question 10

Multiple Choice

How are the accrued benefits of a defined contribution plan measured?

• A) They are measured as the market value of the assets of the plan with no accumulated depreciation deducted.
• B) They are a residual amount: the difference between the carrying amount of the assets and the sum of the income tax and sundry liabilities of the plan.
• C) They are measured in a detailed actuarial review to determine the present value of expected future benefit payments arising as a result of membership of the fund up to measurement date.
• D) They are measured as the difference between the carrying value of the plan's assets and the liability to pay funds out to members on retirement.

---

Definitions:

Existing Business

A company or enterprise that has been operative for a period of time and has a track record of financial and operational history.

Existing Business

Refers to a business that has already been set up and is currently in operation.

Goodwill

An intangible asset representing the value of a company's brand, customer relations, employee morale, and other factors not directly measurable but that contribute to earnings.

Purchase Price

The amount of money paid to acquire a product or service.