Dean Has Earned $70,000 Annually for the Past 4½ Years

question 43

Multiple Choice

Dean has earned $70,000 annually for the past 4½ years working as an architect for MWC. Under MWC's defined benefit plan (which uses a 5-year cliff vesting schedule) employees earn a benefit equal to 3.5% of the average of their three highest annual salaries for every full year of service with MWC. What is Dean's vested benefit (or annual benefit he has earned so far) ?

• A) $12,250.
• B) $42,000.
• C) $7,350.
• D) $0.

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Definitions:

FIFO Method

Stands for "First-In, First-Out," a method of inventory valuation where the first items purchased are the first ones sold.

Job Order Cost Accounting

A system used to assign manufacturing costs to an individual product or batches of products, typically in customized or non-repetitive manufacturing environments.

T Accounts

A visual representation used in accounting to depict the debit and credit sides of an account.

Manufacturing Overhead

All indirect costs related to the manufacturing process, including but not limited to, rent, utilities, and salaries of non-direct labor.