Asked by Manmeet Sanger on Jun 15, 2024
Verified
Your CEO is concerned that employees are not saving enough for their retirement.At the same,the CEO wants to have some of the company's profits shared with all employees.To address these issues,your CEO asks you,a human resource compensation specialist,to recommend the most appropriate profit-sharing plan to address this retirement issue.Which profit-sharing plan would you recommend?
A) deferred
B) combination
C) current distribution
D) cash plan
Deferred
Postponed or delayed to a later time.
Profit-Sharing Plan
A company program that gives employees a share in the profits of the company, often based on the company's yearly earnings.
- Understand the pros and cons associated with employee stock options and profit distribution plans.
Verified Answer
RL
Rebeca LemusJun 19, 2024
Final Answer :
A
Explanation :
Deferred profit-sharing plans allow employees to defer a portion of their compensation as a retirement savings plan. This can encourage employees to save more for their retirement, therefore addressing the CEO's concern. The profit-sharing component of the plan could be based on the company's overall profits, which could help fulfill the CEO's desire to share profits with employees.
Learning Objectives
- Understand the pros and cons associated with employee stock options and profit distribution plans.