The defined benefit liability (deficit) at the end of the second year is
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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À lump sum benefit is payable on termination of service and equal to 1% of final salary for each year of service. The salary in Year 1 is P10,000 and is assumed to increase at 7% (compound) each year. The discount rate used is 104 per year. The entity does not fund its obligation to pay lump sum benefits. The employee is expected to leave at the end of Year 5. The defined benefit liability (deficit) at the end of the second year is
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