Two Sets of Ratios Are Shown in the Schedule of Funding

question 21

Multiple Choice

Two sets of ratios are shown in the schedule of funding progress prepared for Pension Trust Funds: (A) the funded ratio;and (B) the unfunded actuarial accrued liability as a percentage of covered payroll.The financial status of the pension fund is said to be improving when:

• A)both A and B increase over time
• B)both A and B decrease over time
• C)A increases and B decreases over time
• D)A decreases and B increases over time

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Definitions:

Fixed Costs

Constant expenses that remain stable regardless of changes in the business activity level, playing a crucial role in budgeting and financial planning.

Variable Cost

Costs that change in proportion to the volume of goods or services produced.

Trucking Department

A division within a company that is responsible for the transportation and delivery of goods, typically using trucks.

Variable Costs

Expenses that change in proportion to the activity or volume of business, such as materials and labor costs.