I gave up trying to figure out a solution in the settings. I simply copy and paste the final version without markups into a new Word document and save it.
The anomaly is clearly a software bug in WORD FOR MAC 2011 and its lack of compatibility with prior versions of WORD. Your suggestion to simply copy and paste the FINAL version (i.e., the anomaly version with MARKUPS set to off (unchecked), and, FINAL VERSION
set to ON -- available options from the REVIEW tab after accepting all changes, one by one) saved me hours of rework. Thank you!!! I gained further success going forward by changing SETTINGS on the REVIEW TAB to: (a) select NONE for every option in the Markup
category (Insertions, Deletions, Changed Lines, Formatting) and (b) uncheck the choices for the Balloon category.