Entity a Contributes to a Defined Benefit Superannuation Plan for Its

question 22

Multiple Choice

Entity A contributes to a defined benefit superannuation plan for its employees.It calculates the following: Current service cost 12,785
Interest cost 983
Expected return on plan assets (1,150)
Net actuarial gain recognised in period (1,835)
10,783
The 'Expected return on plan assets (1,150) ' represents:

• A) The expected return at the start of the period, measured as a proportion of the current service cost.
• B) The expected return at the start of the period, measured as a proportion of the opening fair value of the plan obligation.
• C) The adjusted return for the period, measured as a proportion of the closing fair value of the plan assets.
• D) The adjusted return for the period, measured as a proportion of the opening fair value of the plan assets.
• E) The expected return at the start of the period, measured as a proportion of the opening fair value of the plan assets.

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Definitions:

Labor Rate Variance

A financial measure that compares the actual cost of labor to the expected or standard cost, indicating how well a company manages its labor expenses.

Labor Efficiency Variance

A measure of the difference between the actual hours worked by employees and the expected hours worked, multiplied by the standard labor rate.

Variable Overhead Rate Variance

The difference between the actual variable overhead incurred and the expected (or standard) costs based on the predetermined overhead rate.

Month

A unit of time, roughly based on the period of the lunar cycle, used in calendars to divide the year.