Don't used Ai solution and don't used hand raiting John has a 30,000 Rand Family Funeral Individual Cover Policy and also covers his twochildren. He added the paid-up add-on benefit to this policy. After four months, John dies dueto non-accidental causes. Which of the options below best describes what will happen to thecover? 30,000 Rand will pay out when claimed by John's beneficiary. The cover for thechildren will end.b. 30,000 Rand will pay out when claimed by John's beneficiary. The cover for the childrenwill continue.c. Only the money-back guarantee will pay out when claimed by John's beneficiary. The coverfor the children will continue. d. Only the money-back guarantee will pay out when claimed byJohn's beneficiary. The cover for the children will end

This is because the "paid-up add-on benefit" typically ensures that the policy remains active for…

Answered: John has a 30,000 Rand Family Funeral…

SWFT Comprehensive Vol 2020

43rd Edition

ISBN:9780357391723

Author:Maloney

Publisher:Maloney

Chapter5: Gross Income: Exclusions

Section: Chapter Questions

Problem 43P

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Alex wants to provide funding in the event of his death for his daughter Ellie, age 8, to attend four years of college, starting at age 18. The current annual cost of tuition is $20,000. Assume inflation of 6.5% and after-tax earnings of 7%. If Alex wants to have enough life insurance to assure adequate funds for Ellie when she begins college (should he die today), approximately how much insurance should he have for this need alone? (Round your answer to the nearest dollar.) A)$113,764 B)$75,806 C)$75,451 D)$79,441
Nikul
Julie has just retired. Her company's retirement program has two options as to how retirement benefits can be received. Under the first option, Julie would receive a lump sum of $158,000 immediately as her full retirement benefit. Under the second option, she would receive $21,000 each year for five years plus a lump- sum payment of $66,000 at the end of the five-year period. Use Excel or a financial calculator to solve. Round answers to the nearest dollar. Required: 1a. Calculate the present value for the following assuming that the money can be invested at 12%. Present Value of First Option Lump-sum payment 2$ 158,000 Present Value of Second Option Total present value $ 134,629 1b. If you can invest money at a 12% return, which option would you prefer? First option Second option References eBook & Resources
Daniel knows that he can withdraw up to a maximum of $35,000 from his Registered Retirement Savings Plan (RRSP) under the Home Buyers Plan (HBP). He knows that he has to pay at least 1/15th of the amount that he borrows. Danieľ's RRSP market value is $45,680 on the day that he decides to withdraw $25,700 under the HBP for the down payment on his new home. What is the minimum annual amount that Daniel must repay to his RRSP on the amount he withdraws from the HBP? A $3,045.33 В $2,333.33 $5,000.00 D $1,713.33 E $3,433.33
Suppose Gretchen's health insurance has a $500 annual deductible. Gretchen is responsible for 20 percent co-pay when she meets her deductible. If Gretchen has $800 in medical expenses this year, how much must she pay?
For several years, Annie’s employer has offered a traditional indemnity plan for healthcare coverage for herself, her husband Jim, and their children, Tess and Tasha. Annie and Jim are in their early 30s; their children are 10-years old twins. Recently, the monthly premium for their insurance coverage increased drastically. Annie’s employer has decided to offer a high-deductible health plan where the family will have an initial deductible of $ 5000. The cost of this high-deductible plan has a monthly premium that is almost 50% lower than the indemnity plan. Describe the steps Annie might follow in deciding whether to choose this plan or to remain with the more expensive indemnity plan.
You are the beneficiary of a life insurance policy. The insurance company informs you that you have two options for receiving the insurance proceeds. You can receive a lump sum of $200,000 today or receive payments of $1,400 a month for 20 years. You can earn 6 percent on your money. Which option should you take and why?
Julie has just retired. Her company’s retirement program has two options as to how retirement benefits can be received. Under the first option, Julie would receive a lump sum of $138,000 immediately as her full retirement benefit. Under the second option, she would receive $25,000 each year for 6 years plus a lump-sum payment of $57,000 at the end of the 6-year period. Click here to view Exhibit 12B-1 and Exhibit 12B-2, to determine the appropriate discount factor(s) using tables. Required: 1-a. Calculate the present value for the following assuming that the money can be invested at 12%. 1-b. If she can invest money at 12%, which option would you recommend that she accept?
Ellie purchases an insurance policy on her life and names her brother, Jason, as the beneficiary. Ellie pays 32,000 in premiums for the policy during her life. When she dies, Jason collects the insurance proceeds of 500,000. As a result, how much gross income does Jason report?
Harry's wife Lila passes away in January of the current year. Fortunately, Lila had a $1 million life insurance policy. Harry elects to receive all $1 million in the current year and spends $200,000 of it on a luxury around-the-world trip with his new girlfriend. Harry's gross income from the life insurance is: $0 $200,000 $800,000 $1,000,000
You are the beneficiary of a life insurance policy. The insurance company informs you that you have two options for receiving the insurance proceeds. You can receive a lump sum of $400,000 today or receive payments of $16,000 a year for 15 years. You can earn 6 percent on your money. Which option should you take and why?
You are the beneficiary of a life insurance policy. The insurance company informs you that you have two options for receiving the insurance proceeds. You can receive a lump sum of $50,000 today or receive payments of $641 a month for 10 years. You can earn 6.50% on your money. What option should you take and why?

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