Which of the Following Is Not a True Statement Concerning

question 25

Multiple Choice

Which of the following is not a true statement concerning the accounting for superannuation costs by employers under a defined benefits plan?

• A) The intention of the employer is to ensure that the plan can meet its agreed benefits as they fall due
• B) When an employee is paid under the superannuation plan, the payment is treated as an expense
• C) The performance of the plan has a direct effect on the statement of financial position of the employer
• D) All are true statements

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Definitions:

Periodic Inventory System

An inventory system where stock levels and cost of goods sold are calculated at the end of an accounting period, rather than updated continuously.

Net Method

An accounting method that records purchases after deducting any available discounts, directly showing the net purchase cost.

Credit Terms

Conditions under which credit will be extended to a customer, including repayment timeframe and interest rate.

Merchandise Inventory

Goods a company has in stock and available for sale, typically in a retail or wholesale setting.