question 16 **Self-Employment Retirement Contribution Example**Kathy is 48 years old and self-employed. During 2023, she reported $522,000 in revenues and $104,400 in expenses related to her self-employment activities. If Kathy has no other retirement accounts in her name, what is the maximum amount she can contribute to an individual 401(k)?**Multiple Choice Options:**- $73,500- $66,000- $7,500- $22,500When determining the maximum contribution to an individual 401(k) for a self-employed individual, the contribution is typically determined based on net earnings from self-employment. In this scenario, this would be the revenue minus expenses.**Steps to Calculate:**1. **Net Earnings:** Calculate the net earnings by subtracting expenses from revenues.2. **Contribution Limits:** Refer to the IRS guidelines for self-employed individual 401(k) contributions, which include elective deferral and employer contribution limits.To get a deeper understanding of how these calculations are done, consider factors like catch-up contributions for individuals over 50, if applicable.

401 (K) Plan: It implies to a plan that is sponsored or funded by the employer with respect to the retirement so as to allow the most eligible employees to make their contributions. These contributions are subtracted by the employer from the salary or gross wages of the employee. As per the Internal Revenue Service (IRS) guidelines, the maximum amount that can be contributed to 401(K) plan by the individual who is below the age of 50 years, has been increased from $20,500 (2022) to $22,500 (2023). This is the basic contribution to be made from the employee side for the year 2023. The $22,500 includes all the after-tax contributions and salary deferrals of elective employees. As Kathy is 48 years which is less than 50 years, therefore the maximum amount that has to be contributed by her is $22,500 for the year 2023, without any extra contributions. Hence, the correct option is $22,500.

Business

Accounting

Kathy is 48 years of age and self-employed. During 2023 she reported $522,000 of revenues and $104,400 of expenses relating to her self-employment activities. If Kathy has no other retirement accounts in her name, what is the maximum amount she can contribute to an individual 401(k)? Multiple Choice $73,500 $66,000 $7,500 $22,500

Kathy is 48 years of age and self-employed. During 2023 she reported $522,000 of revenues and $104,400 of expenses relating to her self-employment activities. If Kathy has no other retirement accounts in her name, what is the maximum amount she can contribute to an individual 401(k)? Multiple Choice $73,500 $66,000 $7,500 $22,500

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Do question 6

A: Balance sheet is a type of financial statements that show the financial balances of any company at…

Q: I'd like the 1st question answered please for problem 23

A: Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: can you also explain what part is a. b. and c. please

A: A budget is an estimate of amount which is prepared by the management for various planning and…

Q: THE SMITH COMPANY Using the business transactions below, complete T-accounts for the Smith Company.…

A: T Accounts 1. Cash Account Particular Debit Particular Credit To capital A/c…

Q: Question 4 a/ Which three term structure facts should a good theory explain?

A: A good theory of the term structure of interest rates should explain the following three facts:

Q: mni.4 answer must be in proper format or i will give down vote

A: Approach to solving the question: post the question Detailed explanation: Post the question and the…

Q: Can solve question 4 to 7?

A: Salary of the Darnell Johnson = 63500Contribution by his employer toward the retirement plan = 6% of…

Q: Question 8

A: When net credit sales is divided with average accounts receivable it results in receivable turnover…

Q: What is the answer to part b? Is it -1245? Is the sign negative or positive?

A: The inventory valuation includes two methods named as FIFO (First in First Out) and LIFO (Last in…

Q: Explain preemptive right

A: Answer: A pre-emptive right is a benefit that can be granted to other owners in a company that gives…

Q: What is the after announcment? This is from question a.

A: Debt Value = $2,700,000Current Debt-to-equity ratio = 30%Increased Debt-to-equity ratio = 50%EBIT =…

Q: Last question help

Q: im.2 answer must be in proper format or i will give down vote

A: When it comes to writing essays or papers, this are the things you have to consider: FORMAT:1.…

Q: Explanation 1031 like-kind exchange

Q: What would the entry be for the letter H.?

Q: question 33

A: Traditional IRA is one of the plans which are used by the taxpayers so that the tax amount which is…

Q: is part b answered in this?

A: Ledger posting. : When any transaction is made journal entry is passed, after that those entries are…

Q: The following equation shows the transactions of Cotton Cleaning Service during May. The business is…

A: Income statement is one of the essential parts of the financial statement used for reporting the…

Q: 17. What are the key features of ERISA?

A: The Employee Retirement Income Security Act of 1974 (ERISA) is a federal statute that provides basic…

Q: Question 6 Listen Which of the following sets represent an intersection, union, subset, and com-…

A: From the Venn diagram :A contains: {2,3,5,7}B contains: {2,4,6,8,10}The universal set S contains:…

Q: WHat ia 2 plus 2

A: Answer:

Q: two questions

A: Prepare an income statement.

Question

question 16

**Self-Employment Retirement Contribution Example**

Kathy is 48 years old and self-employed. During 2023, she reported $522,000 in revenues and $104,400 in expenses related to her self-employment activities. If Kathy has no other retirement accounts in her name, what is the maximum amount she can contribute to an individual 401(k)?

**Multiple Choice Options:**

- $73,500
- $66,000
- $7,500
- $22,500

When determining the maximum contribution to an individual 401(k) for a self-employed individual, the contribution is typically determined based on net earnings from self-employment. In this scenario, this would be the revenue minus expenses.

**Steps to Calculate:**

1. **Net Earnings:** Calculate the net earnings by subtracting expenses from revenues.
2. **Contribution Limits:** Refer to the IRS guidelines for self-employed individual 401(k) contributions, which include elective deferral and employer contribution limits.

To get a deeper understanding of how these calculations are done, consider factors like catch-up contributions for individuals over 50, if applicable.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1: Define Contribution 401 (K)

VIEW

Step 2: 401(K) Contribution Limit

VIEW

Solution

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

how do you calculate the answers for question a
Can you answer part 4
Problem 9-25 Fudge factors An oil company executive is considering investing $10.1 million in one or both of two wells: well 1 is expected to produce oil worth $3.01 million a year for 10 years; well 2 is expected to produce $2.01 million for 15 years. These are real (inflation-adjusted) cash flows. The beta for producing wells is 0.91. The market risk premium is 9%, the nominal risk-free interest rate is 7%, and expected inflation is 3%. The two wells are intended to develop a previously discovered oil field. Unfortunately there is still a 21% chance of a dry hole in each case. A dry hole means zero cash flows and a complete loss of the $10.1 million investment. Ignore taxes and make further assumptions as necessary. a. What is the correct real discount rate for cash flows from developed wells? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) Real discount rate b. The oil company executive proposes to add 20 percentage points to the…
Define direct quote
Please answer G part with explanation
Answer Question 4
please explain the answer B ?
i did ask for a certain question to be resolved question 2b
Why woul it not be Schedule B
Wrong Answer
need help with question 6
hrl.3 answer must be in proper format or i will give down vote