A is the only worker of Cherry Ltd. Cherry Ltd is a reporting entity and needs to
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A is the only worker of Cherry Ltd. Cherry Ltd is a reporting entity and needs to determine the balance of the LSL provision as of 30 June 2019. As of 30 June 2018, the balance relating to A was $14,167. Long Service entitlements accrue over 15 years, by which time the employee will have 3 months of LSL entitlements. If a worker leaves before 10 years, no entitlement is owing. However, from 10 years onwards, pro rata payment would be available on ceasing employment. The following are A's detail:
Salary | $85,000 |
Years of employment so far | 11 |
the estimated annual increase in salary | 5%pa |
Probability A will stay employed for 15 years | 75% |
Discount rate | 8%pa |
Determine the balance of provision for long service leave?
Related Book For
Accounting
ISBN: 978-1118608227
9th edition
Authors: Lew Edwards, John Medlin, Keryn Chalmers, Andreas Hellmann, Claire Beattie, Jodie Maxfield, John Hoggett
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