The balance sheet of a defined benefit pension plan includes the assets in the pension plan measured at fair value and the projected benefit obligation measured using a current interest rate on high-quality fixed-income investments.The difference between the assets and the liabilities indicates the extent to which a pension plan is overfunded or underfunded.

Question

Quizplus · Accepted Answer

This is correct as the balance sheet of a defined benefit pension plan includes the assets measured at fair value and the projected benefit obligation measured using a discount rate based on high-quality fixed-income investments. The difference between the assets and the liabilities shows whether the plan is over- or under-funded.

The Balance Sheet of a Defined Benefit Pension Plan Includes