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Basic Question 6 of 15
In an employer-sponsored defined benefit pension plan, the interest cost included in the pension expense represents the ______.
B. increase in the projected benefit obligation due to the passage of time
C. increase in the fair value of plan assets due to the passage of time
A. effective discount rate times the unamortized balance of prior service costs
B. increase in the projected benefit obligation due to the passage of time
C. increase in the fair value of plan assets due to the passage of time
User Contributed Comments 2
| User | Comment |
|---|---|
| HenryQ | It is calculated as discount rate * beg. PBO. |
| johntan1979 | To be more precise, it's prior period discount rate. |
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Learning Outcome Statements
explain the financial reporting of defined contribution, defined benefit, and stock-based compensation plans
CFA® 2025 Level I Curriculum, Volume 2, Module 8.