Q3. According to U.S. GAAP, companies must account for pension assets and the associated pension obligation in their financial statements. These could be reported in two ways. Method 1 is to report the values of the pension fund assets and liability separately on the balance sheet. Method 2 is to report a net amount for the difference between the value of the fund assets and the fund liabilities. Which of the following statements most accurately describes the requirements of U.S. GAAP? A) Companies are required to use Method 2. B) Companies may choose to use either method. C) Companies are required to use Method 1.
Q4. Prime Doors has recorded a net pension liability of $1.5 million on its balance sheet. According to current U.S. accounting standards, Prime Doors is required to: A) immediately recognize $2,125,000 as additional pension expense in its income statement. B) record $375,000 as additional pension expense on its balance sheet. C) record $2,125,000 as additional pension liability on its balance sheet.
Q5. Which of the following statements regarding the treatment of pension plan amendments under U.S. GAAP standards is most
accurate? A plan amendment results in: A) the disclosure in the pension plan footnotes of the nature of the amendment and the projected future financial impact. B) an immediate increase in pension expense equal to the amount of the amendment. C) an unrecognized prior service cost that is amortized over the expected remaining service life of the affected employees.
Q6. Pension expense as reported by a firm is routinely adjusted by analysts to derive a more accurate measure of a firm’s true economic pension cost. Adjusted pension expense is calculated as: A) reported pension expense – service cost + interest cost. B) reported pension cost – actual return on plan assets. C) service cost + interest cost – actual return on plan assets.
Q7. Under current U.S. GAAP, the assets and liabilities of a defined benefit pension plan are: A) reported in the appropriate section of the balance sheet, with pension obligations shown under liabilities and plan assets shown under assets. B) netted against each other, and only the net asset or liability amount is reported on the company’s balance sheet. C) off balance sheet items which are shown only in the footnotes.
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发表于 2009-1-17 14:23
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