34. In a defined-contribution plan, a formula is used that defines the benefits that the employee will receive at the time of retirement. requires an employer to contribute a certain sum each period based on the formula. ensures that employers are at risk to make sure funds are available at retirement. ensures that pension expense and the cash funding amount will be different.
34. In a defined-contribution plan, a formula is used that defines the benefits that the employee will receive at the time of retirement. requires an employer to contribute a certain sum each period based on the formula. ensures that employers are at risk to make sure funds are available at retirement. ensures that pension expense and the cash funding amount will be different.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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34.
In a defined-contribution plan, a formula is used that
defines the benefits that the employee will receive at the time of retirement.
requires an employer to contribute a certain sum each period based on the formula.
ensures that employers are at risk to make sure funds are available at retirement.
ensures that pension expense and the cash funding amount will be different.
Expert Solution
Step 1
The defined contribution plan is strategized to benefit the employees during the time of retirement.
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