Question: As at 1 May 2015 the present value of the obligation arising from Glasgow plc's defined benefit pension plan was 2,600m. At that date the

As at 1 May 2015 the present value of the obligation arising from Glasgow plc's defined benefit pension plan was £2,600m. At that date the fair value of the plan's assets was £2,400m. The discount rate at the start of the year was 8%. The plan's actuaries predicted a return on the plan's assets of 12%.

The following figures were recorded during the year ended 30 April 2016:

...........................................£m

Current service cost ......290

Benefits paid ...................260

Contributions received ...280

On 30 April 2016 the present value of the plan's obligation was £2,800m and the fair value of the plan's assets was £2,600m.

Required:

a. Calculate the figures that will appear with respect to pensions in Glasgow plc's financial statements for the year ended 30 April 2016.

b. Discuss the suggestion that the estimate for the value of the plan's obligations is too uncertain to be reflected in the financial statements. (15%)

Step by Step Solution

★★★★★

3.44 Rating (160 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

1 Pension Expense 2 Journal entry Account title Explaination Debit Annual ... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!

A firm currently has an overfunded defined benefit pension plan and is short of cash. The chief financial officer (CFO) is considering terminating the defined benefit plan to recapture the excess...

At 31 March 2007, the present value of AZB's pension obligation is $1 634 000. The fair value of the pension plan assets is $1 337 000. Unrecognized actuarial losses are $224 000. What is the amount...

The present value of JECK Co.s expected free cash flows is $100 million. If JECK has $30 million in debt, $6 million in cash, and 2 million shares outstanding, what is its share price?

I need Help with this questions. Most of them are multiple choice with very few essays. This assignment is due in 48 hrs from now 1. Hutton Corp maintains a defined benefit pension plan for...

Please help with the following questions related to the attached financial statements:...

Question:- KPMG Taseer Hadi & Co. as the Auditors of the Company for the year 2019, subject to Shareholders' approval at the next AGM to be held on April 09, 2019. Holding Company Through its wholly...

Hello, I need some assistance with this project. I have everything completed except the third and fourth question (located in the instruction project document. 3.)You are a security analyst...

Read the questions in IFRS2-7 then answer them using the M&S annual reports for the year ended April 2, 2016. (provide complete and comprehensive answers. Also, do not have any grammatical errors) DO...

Hello, I am looking to double check my calculation. Only 3 ratios - please show all the calculations. Need only 2010 -see attached for Financial statements: Days in Accounts Receivable Days Cash on...

LONG-LIVED ASSETS Refer to the notes to the financial statements.The first note, "Summary of Significant Accounting Policies," should provide information about the company's depreciation and...

Suppose that Dunn Industries has annual sales of $4,05 million, cost of goods sold of $1,630,000, average inventories of $1,096,000, and average accounts receivable of $730,000. Assume that all of...

Gao's restaurant produces tacos using workers. The table below shows how many tacos can be served per hour with different quantities of workers. What is the marginal product and average product of...

F zm Zoom Meeting Unmute Stop Video TUGAS #3 You are viewing Novia Sumardi's screen View Options Sign in 00:44:46 View MATA KULIAH FENOMENA PERPINDAHAN LANJUT PRODI MAGISTER TEKNIK KIMIA FAKULTAS...

Your company has a Microsoft Teams Phone deployment that has emergency calling configured for the corporate network. You need to ensure that users can configure an emergency address in their Teams...

Identify an important problem around a school, church, or volunteer group,and define a suitable Six Sigma project. Create a outline of a project charter and identify the important CTQs. (30 points)...

When does business diversification become a consideration for companies? What are the three tests that justify a business diversification decision? Which is better, related business diversification...

Compare the relative rates of growth of the following pair of functions and give the dominant function or declare the functions part of the same family. sin ( 3 / x )

H.J. Heinzs annual dividends were as follows: 1990 ..............$0.540 1991.............. 0.620 1992 .............. 0.700 1993.............. 0.780 1994 .............. 0.860 1995 .............. 0.940...

On January 1, 2015, Ackerman sold equipment to Brannigan (a wholly owned subsidiary) for $200,000 in cash. The equipment had originally cost $180,000 but had a book value of only $110,000 when...

December 31 consolidated financial statements are being prepared for Allsports Company and its new subsidiary acquired on July 1 of the current year. Should Allsports adjust its consolidated balances...

On July 1, 2013, Killearn Company acquired 88,000 of the outstanding shares of Shaun Company for $13 per share. This acquisition gave Killearn a 25 percent ownership of Shaun and allowed Killearn to...

Which do you expect to be more sustainable: grazing on public land or grazing on privately owned pastures? Why?

People with low income spend more, as a share of their overall income, on food and clothing than wealthier people. As a result, they tend to spend a higher proportion of their income relative to...

The government of India has made killing Bengal tigers illegal, but poaching of the endangered animal continues. List some possible reasons that the ban hasnt been very successful, and suggest an...