Drake has worked for GT for the last 20 years and been a participant in its defined benefitplan. In thelast ten years, his salary has increased significantly. Over the last ten years, his compensationwas$300,000, $145,000, $200,000, $400,000, $225,000, $240,000, $233,000, $210,000,$150,000, and$290,000, respectively. In 2022, what is the most that he could receive as a pensionpayment?$285,000.$288,333.O $330,000.$245,000.

A defined benefit plan is a type of employer-sponsored retirement plan that promises employees a…

Answered: Drake has worked for GT for the last 20…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Munabhai
Your client is currently 19 years old. Your client wishes to retire at age 71. Your client's expected lifetime is 96 years. Your fund generates a return of 4.3%. Your client wants to have a pension benefit of 143,000. calculate the annual contribution your client needs to make.
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Steve Weatherspoon, a super salesman contemplating retirement on his ffty-ffth birthday, decides to create a fund on an 9% basis that will enable him to withdraw $ 16,000 per year on June 30, beginning in 2024 and continuing through 2027. To develop this fund. Steve intends to make equal contributions on June 30 of each of the years 2020-2023. What are Steve's contributions to the fund ?
Your client, Karna, has asked you for some advice. He would like to know how much he can contribute to his RRSP in the current year without over contributing. Karna has a carry forward amount of $16,000 and a pension adjustment of $6,000 from the previous year. In addition Karna has been divorced for the past three years and pays $2,500 per month in alimony. Given this scenario and based on the financial information below, how much can Karna contribute this year? Base Salary Commission Bonus Investment Portfolio Capital Gains Dividends $5,000 $6,000 Total taxable income $136,000 Select one: Current Year Previous Year $85,000 $80,000 $25,000 $30,000 $15,000 $18,000 a. $29,080 b. $27,100 c. $27,640 d. $29,260 $4,000 $5,000 $137,000
Shane is about to have his twenty-fifth birthday. He has set a goal of retiring at age 55 with $700,000 in an RRSP. For planning purposes he is assuming that his RRSP will earn 8% compounded annually. (Do not round intermediate calculations and round your final answer to 2 decimal places.) a. What contribution on each birthday from age 25 to 54 inclusive will be required to accumulate the desired amount in his RRSP? PMT b. If he waits five years before starting his RRSP, what contribution on each birthday from age 30 to 54 inclusive will be required to accumulate the target amount? PMT $
Professor Sandra Laneway received a payment of $500,000 from her grandmother’s estate on what is coincidentally her 63rd birthday. Sandra invested the entire inheritance amount today at an interest rate of 8% per annum (compounded monthly) which is due to mature on her 70th birthday when she plans to retire from her job at Sydney University. Upon retirement Sandra plans to commute her investments to a monthly pension which she plans to receive until her 90th birthday. During this 20 years of post-retirement Sandra estimates that she will require an annual pension income of $84,000 ($7,000 per month) in order to live in the manner to which she is accustomed. She expects to receive her first monthly pension payment 1 month after her 70th birthday. In addition, Sandra would like to have a remaining balance of $200,000 in her account at the conclusion of her 20 year pension. Sandra expects to earn a more conservative 6% pa (compounded monthly) over the 20 years following her retirement.…
Caroline has just turned 22 and has begun her first job. Her first year’s salary is $60,000per year, which is paid monthly ($5,000 per month). For planning purposes:•Her future annual salary will grow at a rate of 4% per year.•She will work for 40 years and retire on her 62th birthday.•She will receive a pension payment each year for 30 years beginning on her 62thbirthday.•Accounting for inflation, her first pension payment should be $150,000.•Her pension payments should increase at a rate of 2.5% per year.•She has decided to withdraw 100p% from her monthly paycheck.•She wants to use a 6% EAR as an appropriate interest rate.What is the minimum value for p (to the nearest whole percent) to fund Caroline’s plan?Ignore taxes for this analysis.
1. The home improvement center (HIC) has an employment contract with the newly hired CEO. The contract requires a lump-sum payment of 32.4 million dollars to be paid to the CEP upon the successful completion of her first five years of service. HIC, wants to set aside an equal amount of money at the end of each year to cover this anticipated cash outflow and will earn 7,25% on the funds. How much must HIC is set aside each year for this purpose? a) 7 270 433 b)5 227 064 c)5 668 987 d) 5 606 026 e) 6 778 958
Joe's starting salary as a mechanical engineer is around $100,000. Joe is planning to place a total of 8% of his salary each year in the mutual fund. Joe expects a 5% salary increase each year for the next 30 years of employment. If the mutual fund will average 9% annual return over the course of his career, what can Joe expect at retirement?
Mr. Bill purchased a new house for 110,000. He paid 20,000 down and agreed to pay the rest over the next 30 years in 30 equal end of the year payments plus 12 percent compound interest on the unpaid balance. What will these equal payments be?

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