Question 1 (1 point) Kensington plc, a hypothetical company based in the United Kingdom, offers its employees a defined benefit pension plan. Kensington complies with IFRS. The assumed discount rate that the company used in estimating the present value of its pension obligations was 5.48 percent. Information on Kensington's retirement plans is presented in Exhibit 1. EXHIBIT 1 Kensington plc Defined Benefit Pension Plan for 2010 (in millions) Components of periodic benefit cost: Service cost 228 Net interest (income) expense 273 Remeasurements 18 Periodic pension cost 483 Change in benefit obligation: Benefit obligations at beginning of year 28,416 Service cost 228 Interest cost 1,557 Benefits paid 1,322 Actuarial gain or loss O Benefit obligations at end of year 28,879 Change in plan assets: Fair value of plan assets at beginning of year 23,432 Actual return on plan assets 1,302 Employer contributions 693 Benefits paid 1,322 Fair value of plan assets at end of year 24,105. Funded status at beginning of year 4,984 Funded status at end of year 4,774 Which component of Kensington's periodic pension cost would be shown in OCI other than P&L? 1) Service cost 2) Net interest (income) expense 3) Remeasurements Question 2 (1 point) Kensington plc, a hypothetical company based in the United Kingdom, offers its employees a defined benefit pension plan. Kensington complies with IFRS. The assumed discount rate that the company used in estimating the present value of its pension obligations was 5.48 percent Information on Kensington's retirement plans is presented in Exhibit 1. EXHIBIT 1 Kensington plc Defined Benefit Pension Plan for 2010 (in millions) Components of periodic benefit cost: Service cost 228 Net interest (income) expense 273 Remeasurements 18 Periodic pension cost 483 Change in benefit obligation: Benefit obligations at beginning of 28,416 year Service cost 228 Interest cost 1,557 Benefits paid 1,322 Actuarial gain or loss Benefit obligations at end of year 28,879 Change in plan assets: Fair value of plan assets at 23,432 beginning of year Actual return on plan assets 1,302 Employer contributions 693 Benefits paid 1,322 Fair value of plan assets at end of 24,105 year Funded status at beginning of year 4,984 Funded status at end of year 4,774 0 At year-end 2010, 28,879 million represents: 1) the defined benefit obligation. 2) the fair value of the plants assets. 3) the funded status of the plan