2a)

When accounting for a defined contribution (DC) pension plan, the pension expense each year is:

Choose the right answer below?

1. Based on an amount provided by an actuary
2. Equal to the employers annual contribution to the employees retirement accounts
3. Equal to the amount paid out to retirees
4. Based on the earnings of the plan assets

2b)

Why are companies required to report diluted earnings per share (EPS) along with basic EPS?

Choose the right answer below?

1. To show shareholders EPS before and after the purchase of treasury shares
2. To show shareholders the potential reduction in EPS if potential shares were issued due to the exercise of stock options or the conversion of bonds or preferred stock
3. To show shareholders the potential reduction in EPS if new shares were issued in a public offering of new shares
4. To show shareholders EPS at the beginning and end of the year