Business, 07.04.2020 21:32 Itslegit3

Nick is concerned about how he will fund contributions to a defined contribution plan. You recommend that he use a unit formula based on employee compensation and years of service. The formula is calculated using one unit of credit for each year of service and one unit of credit for each $10,000 in earnings. If Nick is willing to allocate $30,000 in total contribuitons in andy given year, using a total allocation of 80 units (and disregarding any key employee or top-heavy restrictions), what is the maximum amount that will be contributed to Nick's account?

Nick is age 60, has worked in the business for thirty years, and earns $110,000 per year.

a. $9,675
b. $13,225
c. $15,375
d. 22,750

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