During its first year of operations, a company granted employees vacation privileges and pension rights estimated at a cost of $23,889 and $16,846. The vacations are expected to be taken in the next year and the pension rights are expected to be paid in the future 5-30 years. What is the total cost of vacation pay and pension rights to be recognized in the first year?

Select the correct answer.

$23,889

$16,846

$74,427

$40,735