Reference no: EM132555768

Melbourne Ltd provides its employees with long service leave entitlements of 13 weeks of paid leave for every 10 years of continuous service. The company recognises a provision for long service leave using the projected unit credit approach as required by AASB 119. No employees have become entitled to long service leave as the company has only been operating for 5 years.

The following information is relevant to the measurement of long service leave entitlement for Melbourne Ltd for the year ended 30 June 20X2:

1. The number of employees working for the company is 60
2. The employees have worked for the company for 2 years
3. The percentage of employees that are expected to become entitled to long service leave is 40%
4. The average annual salary of the employees is $63,000
5. The yield on relevant government corporate bonds is 5% per annum
6. Estimated average increase in wages for the next 10 years is expected to be 5% per annum

Required

Question 1: Write in the box below the balance of the Provision for Long Service Leave account for Melbourne Ltd as at 30 June 20X2, measured in accordance with the requirements of AASB 119.