LO1 Manuel is an employee of Etowah Corporation and has worked for the company for 22 years. Employees are not required to contribute to the company’s defined benefit plan. Based on the plan, Manuel can retire at 40% of the average of his 3 highest years’ salaries. Determine the amount Etowah will pay Manuel in pension benefits in each of the following situations:

a. His average salary for these 3 years is $50,000.

b. His average salary for these 3 years is $500,000.