Explain when a commitment becomes a recorded liability.
Answer to relevant QuestionsDescribe the required financial statement disclosures for financial instruments with off-balance-sheet risk of loss. How might these disclosures be used to assist financial analysis?Distinguish between different kinds of deferred credits on the balance sheet. Discuss how to analyze these accounts.From a purely economic point of view define what constitutes the following: (a) Pension obligation,(b) Pension plan assets,(c) Net economic position of the pension plan, (d) Economic pension cost.Describe the “corridor method” for deferring and amortizing actuarial gains and losses and return on plan assets. What is the rationale for using this method?Describe alternative measures for the pension obligation. Which measure is legally binding?
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