Question

1.The accounting for defined contribution pension plans is easier (than the accounting for defined benefit plans) because for defined contribution plans each year:

Group of answer choices

The employer records expense equal to the amount paid out to retirees

The employer records expense based on an amount provided by the actuary

The employer records expense equal to the annual contribution paid by the employer into the plan

The employer records expense based on the earnings of the plan assets

2.The employer has an obligation to provide future benefits to retirees under:

Group of answer choices

Defined benefit pension plans

Defined contribution pension plans

Both defined benefit and defined contribution plans

Neither defined benefit or defined contribution plans

Answer 1

1.) The accounting for defined contribution pension plans is easier (than the accounting for defined benefit plants) because for defined contribution plans each year:

The employer records expense equal to the annual contribution paid by the employer into the plan.

2.) The employer has an obligation to provide future benefits to retirees under:

Both defined benefit and defined contribution plans.

These both benefits plans are used to determine the amount of retirement benefits to meet the future obligation.