What Are Past Service Costs in a Defined Benefit Plan

question 2

Multiple Choice

What are past service costs in a defined benefit plan?

• A)Plan amendments that retrospectively improve pension plan benefits.
• B)Difference arising between the actual and the expected value of plan assets.
• C)Expected interest,dividend or income earned on the pension plan assets.
• D)Differences arising between the actual and expected values of the pension obligations.

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Definitions:

Retail Inventory Method

An accounting method used to estimate inventory value by calculating the cost to retail price ratio.

Cost To Retail Ratio

A method used in retail to calculate inventory value by comparing the cost of goods to their retail price.

Ending Inventory

Ending inventory is the value of goods available for sale at the end of an accounting period, calculated as the beginning inventory plus purchases minus the cost of goods sold.

Gross Profit Method

An accounting technique used to estimate inventory levels and cost of goods sold by utilizing the gross profit margin.