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    Benefit Pension Plans and Measurements

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    One of your friends just came out of a lecture on accounting for defined-benefit pension plans. "I can't believe how complicated that is," she says. "And half of the information used is just a guess. I think we should go back to the cash basis of reporting for these plans. At least it was reliable."

    Using your knowledge of how the five components of pension accounting are measured, explain the rationale behind the measurement of at least two of the pension cost components. Comment on the postings of at least two other peers who have used either a different argument or a different component of pension costs.

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    Given the five components of pension accounting and how they are measured, the following are my explanation of the rationale behind two of two of these components:

    1. Service cost which represents the value of the benefits earned by the ...

    Solution Summary

    The expert examines benefit pension plans and measurements.