Under which type of accounting would the request by an employee to transfer the balance of her 401(k) be primarily recorded and managed?

• A. Managerial Accounting
• B. Financial Accounting
• C. Tax Accounting
• D. Payroll/Benefits Accounting

Answer: (D)

Verified step by step guidance

1. Understand the context of the problem: The question is asking about the type of accounting that primarily records and manages the transfer of a 401(k) balance, which is related to employee benefits.
2. Review the definitions of the accounting types provided: Managerial Accounting focuses on internal decision-making, Financial Accounting deals with external reporting, Tax Accounting focuses on tax compliance, and Payroll/Benefits Accounting handles employee compensation and benefits.
3. Identify the key term in the question: The transfer of a 401(k) balance is directly related to employee benefits, which falls under the scope of Payroll/Benefits Accounting.
4. Eliminate the incorrect options: Managerial Accounting, Financial Accounting, and Tax Accounting do not primarily manage employee benefits like 401(k) transfers.
5. Conclude that the correct type of accounting for this scenario is Payroll/Benefits Accounting, as it specifically deals with employee compensation and benefits management.