Statement 1: The rate used to discount post‑employment benefit obligations (both funded and unfunded) shall be determined by reference to market yields at the end of the reporting period on normal quality corporate bonds. Statement 2: The return on plan assets is interest, dividends and other income derived from the plan assets, together with realized and unrealized gains or losses on the plan assets, less: (a) any costs of managing plan assets; and (b) any tax receivable by the plan itself, other than tax included in the actuarial assumptions used to measure the present value of the defined benefit obligation. Only Statement 1 is true. All statements are false. All statements are true. Only Statement 2 is true.
Statement 1: The rate used to discount post‑employment benefit obligations (both funded and unfunded) shall be determined by reference to market yields at the end of the reporting period on normal quality corporate bonds. Statement 2: The return on plan assets is interest, dividends and other income derived from the plan assets, together with realized and unrealized gains or losses on the plan assets, less: (a) any costs of managing plan assets; and (b) any tax receivable by the plan itself, other than tax included in the actuarial assumptions used to measure the present value of the defined benefit obligation. Only Statement 1 is true. All statements are false. All statements are true. Only Statement 2 is true.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Statement 1: The rate used to discount post‑employment benefit obligations (both funded and unfunded) shall be determined by reference to market yields at the end of the reporting period on normal quality corporate bonds.
Statement 2: The return on plan assets is interest, dividends and other income derived from the plan assets, together with realized and unrealized gains or losses on the plan assets, less: (a) any costs of managing plan assets; and (b) any tax receivable by the plan itself, other than tax included in the actuarial assumptions used to measure the present value of the defined benefit obligation.
- Only Statement 1 is true.
- All statements are false.
- All statements are true.
- Only Statement 2 is true.
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