Asked by Macey French on Jul 15, 2024
Verified
A pension plan that promises employees a fixed annual pension benefit, based on years of service and compensation, is called a (n)
A) defined contribution plan
B) defined benefit plan
C) unfunded plan
D) compensation plan
Defined Benefit Plan
A pension plan that promises employees a fixed annual pension benefit at retirement, based on years of service and compensation levels.
Pension Plan
A retirement plan that requires an employer to make contributions into a pool of funds set aside for a worker's future benefit.
Annual Pension Benefit
The amount of money an individual receives annually from their retirement plan after retiring.
- Understand the fundamentals of pension plans and their financial statement implications.
Verified Answer
Learning Objectives
- Understand the fundamentals of pension plans and their financial statement implications.
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