A) is required to be used for reporting the service cost component of pension expense. B) requires pension expense to be determined solely on the basis of the plan formula 14. The projected benefit obligation is the measure of pension obligation that applied to years of service to date and based on existing salary levels. C) is not sanctioned under generally accepted accounting principles for reporting the service cost component of pension expense. requires the longest possible period for funding to maximize the tax deduction. D) 15. The relationship between the amount funded and the amount reported for pension expense is as follows: A) pension expense may be greater than, equal to, or less than the amount funded. B) pension expense must equal the amount funded. C) pension expense will be less than the amount funded. D) pension expense will be more than the amount funded. 16. The actual return on plan assets is equal to the expected rate of return times the fair value of the plan assets at the beginning of the period. is equal to the change in the fair value of the plan assets during the year. includes interest, dividends, and changes in the market value of the fund assets. all of these. A) B) C) D) 17. In accounting for a pension plan, any difference between the pension cost charged to expense and the payments into the fund should be reported as A) an offset to the liability for prior service cost. B) as accumulated other comprehensive income (PSC). ) as other comprehensive income (G/L) D) pension assetliability. 18. When a company adopts a pension plan, prior service costs should be charged to A) B) C) D) Other comprehensive income (PSC). operations of prior periods. accumulated other comprehensive income (PSC) retained earnings. 19. Which of the following statements is correct? A) B) C) Other comprehensive income (PSC) should be included in net income. There is an account titled Accumulated Benefit Obligation. Accumulated Other Comprehensive Income should be reported in the liability section of the balance sheet. D) There is an account titled Pension Asset /Liability