Please help with these questions. Thanks!

5. 6. 9'!" a. b. C. What mechanism does U.S. GAAP employ such that the effects of a bull market in risky assets doesn't distort the P&L for a non-financial company that holds mostly risky assets in their dened benet plan? U.S. GAAP allows the difference between the actual return and the expected return of plan assets to completely bypass the P&L statement. U.S. GAAP allows companies to spread out the gains or losses over time using the corridor approach instead of taking them in 1 accounting period. U.S. GAAP allows companies to exclude pension related amortization if the funded status is in surplus. A U.S. GAAP company with a defined contribution benet plan changes the mandatory retirement age. What costs will be impacted? Prior period service costs Actuarial gains and losses Nothing . Wearing a seatbelt increases your chance of surviving a serious motor vehicle accident by 50%. Each year, 1 out of 940 people will be in a serious motor vehicle accident. JCPenny has more pensioners (dened benefit) than current employees. JCPenny implements a seatbelt awareness campaign for employees - past and present. The campaign is 100% successful. What will this do for the owners of JCPenny stock? Pensioners will live longer than expected. It will improve solvency for JCPenny allowing them to increase dividends. Pensioners will live longer than expected. It will worsen solvency for JCPenny preventing them from increasing share buybacks. Pensioners will live longer and they'll be happy their company cares enough to engage in awareness campaigns - encouraging current employees to work harder. If a company contributes more to plan assets than the total periodic pension cost, what is the company really doing? How could the analyst adjust the CFO? The company is effectively repaying debt or prepaying. The associated cashflow was not an operating cash outow, but a financing outow, thus adjusted CFO will be higher than reported. The company is effectively borrowing from employees, and there are no adjustments to be made to CFO. The company is improving the solvency of the company because it is improving the funded status of the balance sheet