Which of the following statements regarding asset ceilings for overfunded and underfunded pension plans is true? A. For underfunded pension plans, the issue is whether the sponsoring entity can realize the benefits of the underfunding either through reducing or stopping its contributions in the future or through withdrawing surplus funds. B. An overfunded pension results in a net defined benefit liability on the SFP. C. An underfunded pension has a fair value of plan assets that is less than the DBO. D. An asset ceiling is the minimum benefit that the employer can realize by reducing or stopping future contributions to a defined benefit pension plan.
Which of the following statements regarding asset ceilings for overfunded and underfunded pension plans is true? A. For underfunded pension plans, the issue is whether the sponsoring entity can realize the benefits of the underfunding either through reducing or stopping its contributions in the future or through withdrawing surplus funds. B. An overfunded pension results in a net defined benefit liability on the SFP. C. An underfunded pension has a fair value of plan assets that is less than the DBO. D. An asset ceiling is the minimum benefit that the employer can realize by reducing or stopping future contributions to a defined benefit pension plan.
Financial Reporting, Financial Statement Analysis and Valuation
8th Edition
ISBN:9781285190907
Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Chapter9: Operating Activities
Section: Chapter Questions
Problem 3BIC
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Which of the following statements regarding asset ceilings for overfunded and underfunded pension plans is true?
A. For underfunded pension plans, the issue is whether the sponsoring entity can realize the benefits of the underfunding either through reducing or stopping its contributions in the future or through withdrawing surplus funds. |
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B. An overfunded pension results in a net defined benefit liability on the SFP. |
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C. An underfunded pension has a fair value of plan assets that is less than the DBO. |
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D. An asset ceiling is the minimum benefit that the employer can realize by reducing or stopping future contributions to a defined benefit pension plan. |
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