The accounting for defined contribution pension plans is easy because each year:
A. The employer records pension expense equal to the amount paid out to retirees.
B. The employer records pension expense based on an amount provided by the actuary.
C. The employer records pension expense equal to the annual contribution.
D. The employer records pension expense based on the earnings of the plan assets.
Answer:C
The accounting for defined contribution pension plans is easy because each year:
A. The employer records pension expense equal to the amount paid out to retirees. B. The employer records pension expense based on an amount provided by the actuary. C. The employer records pension expense equal to the annual contribution. D. The employer records pension expense based on the earnings of the plan assets.