Which of the following is not true about the cost of a factory employee's pension plan?
A)It is incurred when paid to the employee during his/her retirement.
B)It should be accrued systematically over the period of an employee's active service.
C)In some cases,it may be partially offset by contributions made by employees.
D)It may be charged to general and administrative expenses under the premise that the existence of a pension plan is beneficial to the company as a whole.

Question

Quizplus · Accepted Answer

The cost of a factory employee's pension plan is not only incurred when paid to the employee during his/her retirement; it should also be accrued systematically over the period of an employee's active service. This is because the employer is obligated to make contributions to the pension plan each year and these contributions are considered part of the employee's compensation. Additionally, the pension plan may be partially offset by contributions made by employees, and in some cases, it may be charged to general and administrative expenses under the premise that the existence of a pension plan is beneficial to the company as a whole.

Which of the Following Is Not True About the Cost