. Match each term that follows with the appropriate definition. 1. Defined benefit plan 2….

. Match each term that follows with the appropriate definition.

 1. Defined benefit plan

2. Capital lease

3. Pension plan

 4. Operating lease

5. Defined contribution plan

 a. A contract that requires a company to pay benefits to its employees after they retire.

 b. A short-term lease used for renting assets where ownership of the asset remain with the lessor, and the lease is shorter than the asset’s useful life.

c. A plan in which the employer makes a fixed specified annual contribution, usually a percentage of the employee’s gross pay.

d. A long-term lease that cannot be canceled, has duration about the same as the useful life of the asset, and stipulates that the lessee has the option to buy the asset at a nominal price at the end of the lease.

e. A plan in which the employer contributes an amount annually to fund estimated future pension liability.


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