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on one question on the june 2009 past year question,question 4(b)….expected return is calculated by taking the plan asset fair value at the beginning of the year times the expected return rate right?but why is it on question 4(b),expected return is 15.5?why isnt it 14 (200 x 7%)?
the question stated corridor method?is this somehow related to corridor method?i thought it was abolished?then why is it on question june 2009 4(b),expected return is 15.5?why isnt it 14 (200 x 7%)?
I don’t believe that you’ve asked this! Have you read the printed solution? Look on the line which shows expected return and you’ll find this! “Expected return (200 x 7% + (70 – 26) x 6/12 x 7%)” followed by the figure of 15.5
Surely that explains it – its’ absolutely nothing at all to do with the corridor approach
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