Which of the following is not true about post-retirement benefits?
A)Post-retirement costs should be recognized as expense as the workers earn the right to receive the benefits.
B)Most corporations have fully funded their post-retirement benefits.
C)Unfunded post-retirement costs are a non-cash expense.
D)A corporation's liability for post-retirement benefits is equal to the present value of estimated future payments.

Question

Quizplus · Accepted Answer

Most corporations have not fully funded their post-retirement benefits, as they are typically funded on a pay-as-you-go basis. This means that expenses are recognized as they are incurred, and the liability for post-retirement benefits is based on estimates of future payments. Unfunded post-retirement costs are a non-cash expense because they are not paid out in cash at the time they are recognized as an expense.

Which of the Following Is Not True About Post-Retirement Benefits