Treatment of asset ceiling in employee benefit with defined benefit plan

Lewis, a public limited company, has a defined benefit plan for its employees. The present value of the
future benefit obligations at 1 January 2019 was GH¢1,120,000 and the fair value of the plan assets was
GH¢1,040,000. Further data concerning the year ended 31 December 2019 is as follows:
GH¢
• Current service cost 76,000
• Benefits paid to former employees 88,000
• Contributions paid to plan 94,000
Present value of benefit obligations at 31 December 1,222,000 Fair value of plan assets at 31 December
1,132,000. Interest cost (gross yield on ‘blue chip’ corporate bonds): 5%
On 1 January 2019 the plan was amended to provide additional benefits with effect from that date. The
present value of the additional benefits at 1 January 2019 was calculated by actuaries at GH¢40 000.
Required:
i) Prepare schedules to show the movement in the defined benefit obligation and asset
plans.
ii) Prepare extracts from the statement of profit or loss and other comprehensive income
and statement of financial position for the year ended 31 December 2019
iii) Given the present value of obligation and the fair value of asset at 31 December 2020 as
GH¢1,200,000 and GH¢1,500,000 respectively, and the present value of refund/reduction
in contribution as GH¢200,000; how should the entity account for the net surplus/deficit.