Which group benefits from the use of forfeitures in profit-sharing plans?

In profit-sharing plans, forfeitures refer to the amounts that are not vested to employees who leave the plan before reaching full vesting. The correct answer highlights that participating employees who are 100% vested benefit from these forfeitures because such amounts can be reallocated to them, increasing their share in the profit-sharing plan.

When non-vested employees leave a job, any contributions made on their behalf that are forfeited can be used to enhance the allocations for those who are fully vested. This creates a scenario where the amount of the plan assets that a vested employee receives can be augmented, effectively rewarding their loyalty and longer tenure with the company.

Understanding this mechanism is important for employees to appreciate how their benefits can grow over time based on the activity and decisions involving previous employees. The other groups mentioned do not benefit directly from the use of forfeitures in the same manner, as their status either does not allow them to receive such benefits or they are not participating in the profit-sharing structure at that time.