Question

Appalachian Company maintains a defined-benefit pension plan for its employees. At each balance sheet date, Appalachian should report a pension asset / liability equal to the ________.

Answer 1

Appalachian Company should report a pension asset/liability equal to the difference between the fair value of the plan assets and the projected benefit obligation at each balance sheet date.

Step-by-step explanation:

Appalachian Company should report a pension asset/liability equal to the difference between the fair value of the plan assets and the projected benefit obligation at each balance sheet date. The fair value of the plan assets represents the current value of the investments in the pension fund. The projected benefit obligation represents the present value of the estimated future pension payments to be made to employees based on their years of service and salary levels.