Using the simplified method, determine the tax-free amount of the following distributions from a qualified pension plan. Individual contributions, if any, are made with previously taxed dollars. Use monthly payments table. Required: a. Person A, age 53, made no contributions to the pension plan and will receive a $700 monthly check for life. b. Person B, age 58, made contributions of $25,000 to the pension plan and will receive a monthly check of $1,700 for life. Note: Round your answer to 2 decimal places. c. Person C, age 63, made contributions of $18,000 to the pension plan and will receive monthly payments of $1,300 over her life and the life of her 66-year-old husband. Note: Round your answer to 2 decimal places. d. Person D, age 58, made contributions of $31,000 to the pension plan. He will receive quarterly payments of $4,300 over his life and the life of his 60-year-old wife. Note: Round your answer to 2 decimal places. a. Tax free portion b. Tax free portion. c. Tax free portion d. Tax free portion Amount

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Using the simplified method, determine the tax-free amount of the following distributions from a qualified pension plan. Individual
contributions, if any, are made with previously taxed dollars. Use monthly payments table.
Required:
a. Person A, age 53, made no contributions to the pension plan and will receive a $700 monthly check for life.
b. Person B, age 58, made contributions of $25,000 to the pension plan and will receive a monthly check of $1,700 for life.
Note: Round your answer to 2 decimal places.
c. Person C, age 63, made contributions of $18,000 to the pension plan and will receive monthly payments of $1,300 over her life and
the life of her 66-year-old husband.
Note: Round your answer to 2 decimal places.
d. Person D, age 58, made contributions of $31,000 to the pension plan. He will receive quarterly payments of $4,300 over his life and
the life of his 60-year-old wife.
Note: Round your answer to 2 decimal places.
a. Tax free portion
b. Tax free portion
c. Tax free portion
d. Tax free portion
Amount
Transcribed Image Text:Using the simplified method, determine the tax-free amount of the following distributions from a qualified pension plan. Individual contributions, if any, are made with previously taxed dollars. Use monthly payments table. Required: a. Person A, age 53, made no contributions to the pension plan and will receive a $700 monthly check for life. b. Person B, age 58, made contributions of $25,000 to the pension plan and will receive a monthly check of $1,700 for life. Note: Round your answer to 2 decimal places. c. Person C, age 63, made contributions of $18,000 to the pension plan and will receive monthly payments of $1,300 over her life and the life of her 66-year-old husband. Note: Round your answer to 2 decimal places. d. Person D, age 58, made contributions of $31,000 to the pension plan. He will receive quarterly payments of $4,300 over his life and the life of his 60-year-old wife. Note: Round your answer to 2 decimal places. a. Tax free portion b. Tax free portion c. Tax free portion d. Tax free portion Amount
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