Final answer:
2-year cliff vesting and 3-7 year graduated vesting schedules are allowed under U.S. regulations for stock bonus plans, but 1-10 year graduated vesting and immediate vesting with a 3-year service requirement are not standard allowed schedules.
Step-by-step explanation:
The student is inquiring about allowable vesting schedules for a stock bonus plan. A vesting schedule is a company's timetable for granting employees ownership of stock bonuses or contributions to a retirement plan. The choices given in the question are:
- 2-year cliff vesting
- 1-10 year graduated vesting
- 100% immediate vesting when 3 years of service is required for eligibility
- 3-7 year graduated vesting
Among these options, scenario (a) with 2-year cliff vesting and scenario (d) with 3-7 year graduated vesting would both be allowed under typical U.S. regulations governing qualified retirement plans, such as the Employee Retirement Income Security Act (ERISA). Scenario (b) extends beyond standard limits for a graduated vesting schedule, and (c) proposes immediate vesting which conflicts with the 3-year service requirement, so these would not be standard or typical allowed schedules.