Use the Following Information for Questions

question 64

Multiple Choice

Use the following information for questions.
Maggie Moo, age 40, begins employment with Farm Corporation on January 1, 2017 at a starting salary of $40,000.It is expected that Maggie will work for the company for 25 years, retiring on December 31, 2041, when Maggie is 65 years old.It is expected that her salary at retirement will be $140,000.Further assume that mortality tables indicate the life expectancy of someone age 65 in 2041 is 12 years.
Farm Corporation sponsors a defined benefit pension plan with the following formula
Annual pension benefit on retirement = 3% of salary for each year of service, or 3% final salary x years of service.
Assume a discount rate of 6%
-Determine the current service cost for Maggie Moo at December 31, 2017.

• A)$4,200
• B)$8,212.66
• C)$8,696.69
• D)$35,212.12

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Definitions:

Pupa

A transitional stage of a developing insect, after larva and before adulthood, during which it undergoes transformation.

Cocoon

A protective casing spun by the larvae of many insects, inside which they undergo metamorphosis into their adult form.

Caterpillar

The larval stage of butterflies and moths, often recognized by its elongated body, multiple legs, and the ability to transform into a butterfly or moth.

Topic Sentence

The sentence that expresses the main idea of a paragraph, usually placed at the beginning.