Joan Recently Started Her Career with PDEK Accounting,LLP,which Provides a Defined

question 80

Essay

Joan recently started her career with PDEK Accounting,LLP,which provides a defined benefit plan for all employees.Employees receive 1.5 percent of the average of their three highest annual salaries for each full year of service.Plan benefits vest under a five-year cliff schedule.Joan worked four and a half years at PDEK before leaving for another opportunity.She received an annual salary of $49,000,$52,000,$58,000,and $65,000 for years one through four,respectively.Joan earned $35,000 of her $70,000 annual salary in year five.What is the vested benefit Joan is entitled to receive from PDEK for her retirement?

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Definitions:

Quantity Standard

A predetermined measure of the quantity of inputs expected to be used in the production of goods or services, used for budgeting and performance evaluation.

Standard Cost System

An accounting system that uses predetermined costs for products and services to help managers control costs by comparing them with actual costs.

Raw Materials

The basic materials and components required to start the production process.

Standard Cost Card

A detailed listing of the standard amounts of inputs and their costs that are required to produce a unit of a specific product.