The retirement income payable from which of the following retirement income benefit programs is independent of the performance of any underlying investment portfolio? OA. RRSP OB. CPP OC. DCPP OD. TFSA CO
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- Which of the following is not a component of pension expense? a. amount funded b. service cost c. expected return on plan assets d. interest costUnder PAS 26 (Accounting and Reporting by Retirement Benefit Plans), investments held by retirement benefit plans should be stated at which of the following value in their statement of net assets? Fair Value Value in use Net Realizable Value Orig cost less impairmentQuestion text In determining the present value of the prospective benefits (often referred to as the defined benefit obligation), the following are considered by the actuary: Select one: а. retirement and mortality rate. b. benefit provisions of the plan. c. all of these factors d. interest rates.
- Net interest cost is a component of pension expense under IFRS. How is net interest cost calculated? Select one: O a. The increase in the DBO over the period, net of the increase in the plan assets over the period. O b. Interest expense on the DBO, net of actual interest income earned on plan assets. O c. Interest expense on the defined benefit obligation (DBO), net of expected interest income earned on plan assets. O d. The increase in the DBO over the period, net of the increase in the plan assets over the period.Define defined contribution (DC) retirement planDefine defined benefit (DB) retirement plan
- What are the four basic components of pension expense? Select one: A. Service cost, benefits paid, expected return on plan assets, and amortization of deferred amounts B. Service cost, benefits paid, actual return on plan assets, and amortization of deferred amounts C. Service cost, interest cost, actual return on plan assets, and amortization of deferred amounts D. Service cost,interest cost, expected return on plan assets, and amortization of deferred amounts E. None of the aboveWhich of the following retirement plans are directly connected to the size of the investment portfolio? In other words, the larger the investment portfolio, the greater the potential retirement income benefit. I. Defined Contribution Pension Plan (DCPP) II. Registered Retirement Savings Plan (RRSP) II. Old Age Security IV. Tax-Free Savings Account (TFSA) V. Canada Pension Plan (CPP) and Quebec Pension Plan (QPP) A II, IV and V В III and IV C I, Il and III I, Il and IV E III and Vlook over the three most important components of the pension expense. The treatment of expected and actual return on plan assets, particularly when the actual return is greater than the expected, the amortization of prior service cost and the unexpected gain/ loss. Discuss the accounting treatment of these items with suitable examples.
