Which of the following characteristics is/are indicative of a post-employment defined contribution plan? If actuarial or investment experience are worse than expected, the entity’s obligation may be increased. The amount to be received by the employee is determined by the amount of contributions paid by an entity to the plan, with investment returns arising from the contributions. The entity’s obligation is to provide the agreed benefits to current and former employees. The entity’s legal or constructive obligation is limited to the amount that it agrees to contribute to the fund. Group of answer choices Only statements 1 and 2. Only statements 2 and 3. Only statements 2 and 4. Only statements 3 and 4.

Which of the following characteristics is/are indicative of a post-employment defined contribution plan? If actuarial or investment experience are worse than expected, the entity’s obligation may be increased. The amount to be received by the employee is determined by the amount of contributions paid by an entity to the plan, with investment returns arising from the contributions. The entity’s obligation is to provide the agreed benefits to current and former employees. The entity’s legal or constructive obligation is limited to the amount that it agrees to contribute to the fund. Group of answer choices Only statements 1 and 2. Only statements 2 and 3. Only statements 2 and 4. Only statements 3 and 4.

Individual Income Taxes

43rd Edition

ISBN:9780357109731

Author:Hoffman

Publisher:Hoffman

Chapter19: Deferred Compensation

Section: Chapter Questions

Problem 2DQ

See similar textbooks

Similar questions

Which of the following statements are true? When an employee has rendered service to an entity during a period, the entity shall recognize the contribution payable to a defined contribution plan in exchange for that service: As a liability, after deducting any contribution already paid. If the contribution already paid exceeds the contribution due for service before the end of the reporting period, an entity shall recognize that excess as an asset, regardless if the prepayment will lead to a reduction in future payments or a cash refund, or not. Group of answer choices Only statement 2. None of the statements are true. Only statement 1. Both statements 1 and 2.
In a defined contribution plan, as long as the employer makes a definite contribution to the plan, the investment risk is carried by the employee. In a defined contribution plan, as long as the employer makes a definite contribution to the plan, the investment risk is carried by the employee. True or false?
When the employee bears the entire costs of discretionary benefits it is referred to as which type of financing? Select one: a. Contributory b. Noncontributory c. Employee-focused d. Employee-financed
Which of the following is not an approach to financing employee benefits? Select one: a. Noncontributory b. Employee-financed c. Contributory d. Voluntary
Which of the following is an indicator that an employee benefit is provided in exchange for services? the benefit is provided in accordance with the terms of an employee benefit plan the benefit is conditional on future service being provided either of the choices both of the choices
Employee benefits are all forms of monetary consideration given by an entity in exchange for services rendered by employees or for the termination of employment True or false?
In a defined contribution plan, as long as the employer makes a definite contribution to the plan, the investment risk is carried by the employee. a. TRUE b. FALSE
Which of the following does not describe a defined contribution plan? The employer bears the risk of investment in a defined contribution plan. The contribution is certain but the benefit is uncertain. If the plan does poorly, the employee will share in the loss by paying more contributions. The accumulated fund on the date of an employee’s retirement determines the benefit.
Which statement is incorrect regarding recognition of employee benefits? a. The enterprise should recognize the expected cost years of service. of profit-sharing and bonus payments when, and only when, it has a legal or constructive obligation to make such payments as a result of past events and a reliable estimate of the expected cost can be made b. For short-term employee benefits, the undiscounted amount of the benefits expected to be paid in respect of service rendered by employees in a period should be recognized in that period. c. The cost of providing employee benefits should be recognized in the period in which the benefit is earned by the employee, rather than when it is paid or payable. d. For post-employment benefits, the cost to be recognized in the period is the contribution payable in exchange for service rendered by employees during the period.
Which of the following is/are true with regard to accounting for short-term employee benefits? Unpaid short-term benefits are reported as accrued under current liabilities at an undiscounted value. If the payment exceeds the undiscounted amount of the benefits, the excess is reported as prepayment under current assets. The benefits are reported as an expense under profit or loss, unless another standard requires or permits the cost of the benefits to be capitalized. Group of answer choices Only statement 1. All statements are true. Only statement 3. Only statement 2.
It is a type of retirement plan where the benefit to be received by the employee is dependent on the contributions made to the plan and on the investment performance of the plan. The risk that the benefits to be received may be insufficient is retained by the employee. a. Defined contribution plan b. Defined benefit plan c. none of the above d. a or b
Which of the following is a characteristic of the accumulated benefit obligation measurement? Group of answer choices It considers only vested employees. It considers only current employees. It does not use projected future salary levels. It is required by GAAP for measurement of the pension obligation.