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Andrea recently started her career with a company which provides a defined benefit plan for all employees. Employees receive 1.5 % of the average
Andrea recently started her career with a company which provides a defined benefit plan for all employees. Employees receive 1.5 % of the average of their three highest annual salaries for each full year of service. Plan benefits vest under a five-year cliff schedule. Andrea worked 5 1/2 years at the company before leaying. She received an annual salary of $49,700, $52,350, $58,175, $65,350, and $75,525 for years one through five, respectively. She earned $40,350 of her $80,700 annual salary in year six. What is the vested benefit Andrea is entitled to receive from the company? Use Exhibit 13-1.
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