Answer Happy

1 year 9 years Fleetwood Ltd commenced operations on 1 July 2020 and had 420 employees. Average salaries were $70,000 per annum for the year. Fleetwood Ltd accounts for all cespedised employee costs as expenses. Employees are entitled to 13 weeks of long service leave after 10 years of employment The following information is based on advice received from actuarial consultants at 30 June 2021. Number of years unit credit Number of years until long service leave is expected to be paid Probability that long service leave will be taken Expected increase in salaries (based on inflation) Yield on 9-year high quality corporate bonds at 30/06/2021 Projected $1 salary over 9 years at 1.5% inflation rate Present value of $1 lump sum in 9 years at 10% 3096 1.596 1096 1.1434 0.4241 Required Determine the obligation for long service leave at 30 June 2021, applying the projected unit credit method in accordance with AASB 119/1AS 19, and prepare the journal entry to account for changes in the provision for long service leave. (5 marks)