A retirement plan if created by an employer for the exclusive benefit of employees or their beneficiaries, is only qualified for income tax purposes, in addition to that contributions and benefits under a plan must not discriminate in favor of a highly compensated employee. This plan must also meet certain participation and coverage requirements, minimum vesting requirements and uniform minimum distribution rule. To choose: The correct answer to determine the type of retirement plan G’s employer contributes to.

Question

Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for several years. The most recent quarterly contribution format income statement for the bilge pump follows: Thalassines Kataskeves, S.A. Income Statement—Bilge Pump For the Quarter Ended March 31 Sales $ 410,000 Variable expenses: Variable manufacturing expenses $ 123,000 Sales commissions 50,000 Shipping 21,000 Total variable expenses 194,000 Contribution margin 216,000 Fixed expenses: Advertising (for the bilge pump product line) 27,000 Depreciation of equipment (no resale value) 120,000 General factory overhead 38,000* Salary of product-line manager 113,000 Insurance on inventories 5,000 Purchasing department 49,000† Total fixed expenses 352,000 Net operating loss $ (136,000) *Common costs allocated on the basis of machine-hours. †Common costs allocated on the basis of…

Answer 1

Question

Chapter 9, Problem 18MCQ

To determine

Introduction: A retirement plan if created by an employer for the exclusive benefit of employees or their beneficiaries, is only qualified for income tax purposes, in addition to that contributions and benefits under a plan must not discriminate in favor of a highly compensated employee. This plan must also meet certain participation and coverage requirements, minimum vesting requirements and uniform minimum distribution rule.

To choose: The correct answer to determine the type of retirement plan G’s employer contributes to.

Expert Solution & Answer

Trending nowThis is a popular solution!

See solution

Check out sample textbook solution

Students have asked these similar questions

Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for several years. The most recent quarterly contribution format income statement for the bilge pump follows: Thalassines Kataskeves, S.A. Income Statement—Bilge Pump For the Quarter Ended March 31 Sales $ 410,000 Variable expenses: Variable manufacturing expenses $ 123,000 Sales commissions 50,000 Shipping 21,000 Total variable expenses 194,000 Contribution margin 216,000 Fixed expenses: Advertising (for the bilge pump product line) 27,000 Depreciation of equipment (no resale value) 120,000 General factory overhead 38,000* Salary of product-line manager 113,000 Insurance on inventories 5,000 Purchasing department 49,000† Total fixed expenses 352,000 Net operating loss $ (136,000) *Common costs allocated on the basis of machine-hours. †Common costs allocated on the basis of…

Do companies maintain two sets of depreciation schedules, one for financial reporting and the other one for tax purposes?

none ??