In an unfunded plan the employees right to receive future...

In an unfunded plan, the employee's right to receive future benefits must be A) evidenced by negotiable promissory notes. B) subject to a risk of forfeiture. C) an unsecured promise to pay. D) fully transferable.

Transcript

00:01 Hello students, here is a question.

00:02 In an unfolded plan, the employee right to receive a future benefit, so must be, so we have four options here.

00:10 Option a is evidenced by negotiable promissory note, evidenced by negotiable promissory note, notes and the second is subject to risk for feature, subjected to a risk for feature and then the third is an unsecured promise to pay and d is fully transferable.

01:05 So, these are the four options we have.

01:08 Let us discuss the answer for this.

01:10 So, here a sort of employee benefit plan known as unfolded plan is one of which the company guarantee to offer a future benefits to worker without putting aside special cash to pay for those benefits.

01:24 Benefit under such plans are simply an assurance from an employer to the employee.

01:29 The nature of employee rights to receive a future benefits under an unfolded plan is a subject of query.

01:36 So, for this question option c is the right answer.

01:40 So, we will justify why other options are incorrect because a negotiable promissory note.

01:49 So, are the financial instruments that convey a format written promises to return a certain amount of money by a specific date.

01:57 Hence, answer a is incorrect.

02:01 So, when it comes to an option b, the choice is enormous because a risk of fortune is a term frequently used to distinguish between a benefit that is that has been wasted and those that are not if an employee exist in sponsored plan before reaching fully visiting.

02:18 So, there may be a risk of fortune...

Question

In an unfunded plan, the employee's right to receive future benefits must be A) evidenced by negotiable promissory notes. B) subject to a risk of forfeiture. C) an unsecured promise to pay. D) fully transferable.

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