Which statement about "defined contribution plans" is correct?

Question

Quizplus · Accepted Answer

Defined contribution plans are retirement plans in which the employer and/or employee contribute a certain amount of money or a percentage of the employee's salary to a retirement account. The pension expense for these plans equals the contributions made based on the plan formula. In other words, the employer's accounting expense is based on the amount contributed to the plan, not on the amount of benefits that will ultimately be paid out to the retiree. Choices B, C, and D do not accurately reflect the nature of defined contribution plans.

Which Statement About "Defined Contribution Plans" Is Correct