Match the following pension and postretirement benefit terms and descriptions. Term 1. Amortization of prior service cost

Match the following pension and postretirement benefit terms and descriptions.

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Term 1. Amortization of prior service cost 2. Accumulated postretirement benefit obligation 3. Obligations under postretirement benefit 4. Classification of the pension asset or pension liability 5. Projected benefit obligation Description a. The present value of vested and nonvested benefits accrued to date, based on employees' future salary levels. b. Recently, the FASB required more extensive disclosures related to pension plan assets. At a minimum, companies must disclose the amount of assets allocated to equities, government and corporate bonds, mortgage-backed securities, derivatives, and real estate. Also, information on concentrations of risk must be explained. Finally, fair value disclosures would be required, including classification of amounts into levels of the fair value hierarchy. c. The actuarial present value of future benefits attributed to employees' services rendered to a particular date. d. In defining the obligation for postretirement benefits, the FASB maintained many concepts similar to pension accounting. It also designed some new and modified terms specifically for postretirement benefits. Two of the most important of these specialized terms are (a) expected postretirement benefit obligation and (b) accumulated postretirement benefit obligation. e. The board prefers a years-of-service method that is similar to a units-of- production computation. First, the company computes the total number of service-years to be worked by all of the participating employees. Second, it divides the prior service cost by the total number of service- years, to obtain a cost per service-year (the unit cost). Third, the company multiplies the number of service-years consumed each year by the cost per service-year, to obtain the annual amortization charge.