Question

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

Answer 1

0

Step-by-step explanation:

The clicf vesting is for 5 years.

Currently Dean is not vested as he doesn't meet the requirement to be vester for the plan.

Leaving the company today will have zero benefit has he has earned nothing.

When there is a cliff vesting only after completely fullfilthe condition the employee earns the benefit.

While in other situation there can be partial vestment, in this case, there are none.