1. The interest cost component of the net defined benefit cost is determined using a. the settlement rate of interest. b. the rate of return on high quality corporate bonds c. both a and b. d. neither a or b. 2. Financial reporting standards for pension currently in effect a. allow both the accrued benefit and projected benefit methods. b. allow only the accrued benefit method/ projected unit credit method. c. allow only the projected benefit method. d. do not allow either the accrued benefit or projected benefit methods. 3. Which of the following is not correct? a. PAS 19 does not include any provisions for the recognition of an additional minimum liability. b. PAS 19 does not allow for the recognition of a net pension asset equal to the computed surplus in some circumstances. c. PAS 19 requires the 10% corridor amount in calculating the amortization of deferred gains and losses. d. PAS 19 requires settlement gains and losses to be recognized immediately as part of comprehensive income.
1. The interest cost component of the net defined benefit cost is determined using a. the settlement rate of interest. b. the rate of return on high quality corporate bonds c. both a and b. d. neither a or b. 2. Financial reporting standards for pension currently in effect a. allow both the accrued benefit and projected benefit methods. b. allow only the accrued benefit method/ projected unit credit method. c. allow only the projected benefit method. d. do not allow either the accrued benefit or projected benefit methods. 3. Which of the following is not correct? a. PAS 19 does not include any provisions for the recognition of an additional minimum liability. b. PAS 19 does not allow for the recognition of a net pension asset equal to the computed surplus in some circumstances. c. PAS 19 requires the 10% corridor amount in calculating the amortization of deferred gains and losses. d. PAS 19 requires settlement gains and losses to be recognized immediately as part of comprehensive income.
Auditing: A Risk Based-Approach to Conducting a Quality Audit
10th Edition
ISBN:9781305080577
Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Chapter16: Advanced Topics Concerning Complex Auditing Judgments
Section: Chapter Questions
Problem 41RSCQ
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Question
1. The interest cost component of the net defined benefit cost is determined using
a. the settlement rate of interest.
b. the rate of return on high quality corporate bonds
c. both a and b.
d. neither a or b.
2. Financial reporting standards for pension currently in effect
a. allow both the accrued benefit and projected benefit methods.
b. allow only the accrued benefit method/ projected unit credit method.
c. allow only the projected benefit method.
d. do not allow either the accrued benefit or projected benefit methods.
3. Which of the following is not correct?
a. PAS 19 does not include any provisions for the recognition of an additional minimum liability.
b. PAS 19 does not allow for the recognition of a net pension asset equal to the computed surplus in some circumstances.
c. PAS 19 requires the 10% corridor amount in calculating the amortization of deferred gains and losses.
d. PAS 19 requires settlement gains and losses to be recognized immediately as part of comprehensive income.
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