Term
| What is a defined contribution pension plan? |
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Definition
| A promise fixed annual contributions to a pension fund. Employees choose where funds are invested--usually stock or fixed-income securities. retirement pay depends on the size of the fund at retirement. |
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Term
| What is a defined benefit pension plan? |
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Definition
| It is a promised fixed retirement benefits defined by a designated formula. |
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Term
| What is a vested benefit? |
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Definition
| Vested benefits are those that employees have the right to recieve even if their employment were to cease today. |
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Term
| What is the accumulated benefit obligation? |
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Definition
| It is an estimate of the discounted present value of the retirement benefits earned so far by employees, applying the plan's pension formula using existing compensation levels. |
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Term
| What is a projected benefit obligation? |
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Definition
| A projected benefit obligation estimates retirement benefits by applying the pension formula using projected future compensation levels. |
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Term
| What is a basic pension formula? |
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Definition
| % X Service Years X Final year's salary |
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Term
| What are the components of pension expense. |
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Definition
| Service Costs, interest costs, return on plan assets, amortization of prior service costs, and amortization of deferred net loss or net gain. |
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Term
| What are other postretirement benefits? |
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Definition
| Medical coverage, dental coverage, life insurance, and group legal life insurance? |
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