Question

The actual return on plan assets _________.a. includes interest, dividends, and changes in the fair value of the fund assets. b. is equal to the expected rate of return times the fair value of the plan assets at the beginning of the period. c. is equal to interest expenses accrued each year on the projected benefit obligation, just as it does on any discounted debt. d. is equal to the change in the fair value of the plan assets during the year.

Answer 1

Answer:

a. includes interest, dividends, and changes in the fair value of the fund assets

Explanation:

Actual return on plan assets refers to the dividends, interest,  changes in the fair value and capital gains generated by assets held in a company's pension fund. The value of plan assets increases when there are additional contributions to the plan assets and when there is a positive return as a result of the plan assets. It is the sum of interest earned, dividends earned, realized and unrealized gains or losses minus taxes payable by the plan minus administrative costs of the plan.

Answer 2

Answer:

a. includes interest, dividends, and changes in the fair value of the fund assets.

Explanation:

In accounting, the actual return on plan assets includes interest, dividends, and changes in the fair value of the fund assets.

Also, it takes into account actual changes in the market values of fund assets.