Which of the Following Is/are True Regarding the Accounting for Defined

question 6

Multiple Choice

Which of the following is/are true regarding the accounting for defined contribution plans?

• A)When pension assets equal pension liabilities and the expected rate of return on pension investments equals the discount rate used to compute the projected benefit obligation, the amounts offset each other.
• B)When the interest cost exceeds the expected return on pension investments, either employer contributions or future earnings on pension plan investments must make up the difference.
• C)Computing pension expense (or credit) using the expected return (not the actual return) rests on the view that pension plans should take a long-term perspective and generate earnings from investments based on a long-term expected rate of return.
• D)Annual deviations from the long-term expected rate of return should not flow through to net income as they occur.
• E)all of the above

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Definitions:

Adaptability

The capacity to adjust to changing conditions or environments, demonstrating flexibility and resilience.

Slow-To-Warm-Up

A temperament where individuals are hesitant in new situations but become more comfortable over time.

Temperament

An individual's innate disposition or personality, often observable from early childhood and influencing behavior and emotional reactions.

Uncrowded

Refers to a situation or environment that is not filled or packed with people, offering more space and less congestion.