Chapter K, Problem 8Q

To determine

Other significant liabilities

Other significant liabilities are liabilities other than current and long-term liabilities. These liabilities have a significant impact on the future cash flows and financial position of the company. Contingent liabilities, lease liabilities and additional liabilities for employee fringe benefits are the examples of other significant liabilities.

Fringe benefits

Fringe benefits are an additional benefit received by an employee other than his/her wages. Life insurance coverage, health insurance, company car, pension plan benefits, paid absences-vacation pay; paid holidays and sick pay are the examples of fringe benefits.

Pension plan

Pension plan is an agreement between the employer and employee. After the retirement of an employee an employer provides benefits is called as pension plan.

To Describe: The two types of postretirement benefits and during what years does the FASB advocate expensing the employer's cost of these postretirement benefits.