FS LTD. has a defined benefit pension plan. As at 31 December 2018, its plan assets had a book value of Shs. 140 million and a fair value of Shs. 160 million. The PBO at the time was Shs. 150 million. During the year, the company contributed an amount of Shs. 20 million to the fund, the fund paid out Shs. 15 million while the return on plan assets was Shs. 10 million. Service costs were Shs. 30 million, interest cost amounted to Shs. 12 million while actuarial gains were Shs. 3 million. Required: I) Fair value of plan assets as at 31 December 2019. ii) The projected plan obligation as at 31 December 2019.
FS LTD. has a defined benefit pension plan. As at 31 December 2018, its plan assets had a book value of Shs. 140 million and a fair value of Shs. 160 million. The PBO at the time was Shs. 150 million. During the year, the company contributed an amount of Shs. 20 million to the fund, the fund paid out Shs. 15 million while the return on plan assets was Shs. 10 million. Service costs were Shs. 30 million, interest cost amounted to Shs. 12 million while actuarial gains were Shs. 3 million. Required: I) Fair value of plan assets as at 31 December 2019. ii) The projected plan obligation as at 31 December 2019.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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FS LTD. has a defined benefit pension plan. As at 31 December 2018, its plan assets had a book value of Shs. 140 million and a fair value of Shs. 160 million. The PBO at the time was Shs. 150 million. During the year, the company contributed an amount of Shs. 20 million to the fund, the fund paid out Shs. 15 million while the return on plan assets was Shs. 10 million. Service costs were Shs. 30 million, interest cost amounted to Shs. 12 million while actuarial gains were Shs. 3 million.
Required:
I) Fair value of plan assets as at 31 December 2019.
ii) The projected plan obligation as at 31 December 2019.
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