We present a theoretical framework to describe state-resolved ionization dynamics of neon atoms driven by ultraintense x-ray free-electron-laser pulses. In general, x-ray multiphoton ionization dynamics of atoms have been described by time-dependent populations of the electronic configurations visited during the ionization dynamics, neglecting individual state-to-state transition rates and energies. Combining a state-resolved electronic-structure calculation, based on first-order many-body perturbation theory, with a Monte Carlo rate-equation method enables us to study state-resolved dynamics based on time-dependent state populations. Our results demonstrate that configuration-based and state-resolved calculations provide similar charge-state distributions, but the differences are visible when resonant excitations are involved, which are also reflected in calculated time-integrated electron and photon spectra. In addition, time-resolved spectra of ions, electrons, and photons are analyzed for different pulse durations to explore how frustrated absorption manifests itself during the ionization dynamics of neon atoms.