Present value. The State of Confusion wants to change the current retirement policy for state employees....
Homework Answers
FV of the retirement payment after 20 years = 350,000 per
employee
PV of The benefit = 350,000/(1+5%)
Total Amount to be paid to all its employees = 260,000 *
350,000/1.05 = 86,666,666.66
Please Discuss in case of Doubt
Best of Luck. God Bless
Please Rate Well
Add Answer to:
Present value. The State of Confusion wants to change the
current retirement policy for state employees....
In recent years, there has been a lot of media coverage about the funding status of...
In recent years, there has been a lot of media coverage about the funding status of pension plans for state employees. In many states, the amount of money invested in employee pension plans is far less than the amount estimated to pay employees the retirement benefits they have been promised. Basically, pension plans work by investing enough money while employees are working so that the money invested, plus the investment income it earns over the years, will be sufficient to...
Stone Corporation has a defined benefit pension plan. One of its employees has vested benefits under...
Stone Corporation has a defined benefit pension plan. One of its employees has vested benefits under the plan, which will pay her $30,000 annually for life starting with the first $30,000 payment on the day she retires at the age of 65. The employee has just reached the age of 45. Stone consulted standard mortality tables to come up with a life expectancy of 80 for this employee. The implicit interest rate under the plan is 9%. Required: To fulfill...
Blue, Inc. is a furniture manufacturing company with 50 employees. Recently, after a long negotia...
Blue, Inc. is a furniture manufacturing company with 50 employees. Recently, after a long negotiation with the local labor union, the company decided to initiate a pension plan as a part of its compensation plan. The plan will start on January 1,2017. Each employee covered by the plan is entitled to a pension payment each year after retirement. As required by accounting standards, the controller of the company needs to report the pension obligation (liability).On the basis of a discussion...
2. (5 points) Nerwin, Inc. is a furniture manufacturing company with 50 employees. Recently, after a...
2. (5 points) Nerwin, Inc. is a furniture
manufacturing company with 50 employees. Recently, after a long
negotiation with the local labor union, the company decided to
initiate a pension plan as a part of its compensation plan. The
plan will start on January 1, 2014. Each employee covered by the
plan is entitled to a pension payment each year after retirement.
On the basis of a discussion with the supervisor of the Personnel
Department and an actuary from an...
2. (5 points) Nerwin, Inc. is a furniture manufacturing company with 50 employees. Recently, after a long negotiation wi...
2. (5 points) Nerwin, Inc. is a furniture
manufacturing company with 50 employees. Recently, after a long
negotiation with the local labor union, the company decided to
initiate a pension plan as a part of its compensation plan. The
plan will start on January 1, 2014. Each employee covered by the
plan is entitled to a pension payment each year after retirement.
On the basis of a discussion with the supervisor of the Personnel
Department and an actuary from an...
Cheyenne, Inc. is a furniture manufacturing company with 50 employees. Recently, after a long negotiation with...
Cheyenne, Inc. is a furniture manufacturing company with 50 employees. Recently, after a long negotiation with the local labor union, the company decided to initiate a pension plan as a part of its compensation plan. The plan will start on January 1, 2020. Each employee covered by the plan is entitled to a pension payment each year after retirement. As required by accounting standards, the controller of the company needs to report the pension obligation (liability). On the basis of...
2. (5 points) Nerwin, Inc. is a furniture manufacturing company with 50 employees. Recently, after a...
2. (5 points) Nerwin, Inc. is a furniture manufacturing company with 50 employees. Recently, after a long negotiation with the local labor union, the company decided to initiate a pension plan as a part of its compensation plan. The plan will start on January 1, 2014. Each employee covered by the plan is entitled to a pension payment each year after retirement. On the basis of a discussion with the supervisor of the Personnel Department and an actuary from an...
Present value. Standard Insurance is developing a long-life insurance policy for people who outlive their retirement...
Present value. Standard Insurance is developing a long-life insurance policy for people who outlive their retirement nest egg. The policy will pay out $260,000 on your 82nd birthday. You must buy the policy on your 65th birthday The insurance company can earn 5.5% on the purchase price of your policy. What is the minimum purchase price the insurance company should charge for this policy?
Lakeland Corp. calculates that in the current year its employees earned an additional annuity of $10,000 for 20 year...
Lakeland Corp. calculates that in the current year its employees earned an additional annuity of $10,000 for 20 years commencing with their retirement 12 years from today. Lakeland assumes a future interest rate of 6%. If the value of the annuity is $121,581 on the date the employees retire, what amount should be contributed today to fully fund the pension plan?
Sarasota, Inc. is a furniture manufacturing company with 50 employees. Recently, after a long negotiation with...
Sarasota, Inc. is a furniture manufacturing company with 50 employees. Recently, after a long negotiation with the local labor union, the company decided to initiate a pension plan as a part of its compensation plan. The plan will start on January 1, 2020. Each employee covered by the plan is entitled to a pension payment each year after retirement. As required by accounting standards, the controller of the company needs to report the pension obligation (liability). On the basis of...
In recent years, there has been a lot of media coverage about the funding status of pension plans for state employees. In many states, the amount of money invested in employee pension plans is far less than the amount estimated to pay employees the retirement benefits they have been promised. Basically, pension plans work by investing enough money while employees are working so that the money invested, plus the investment income it earns over the years, will be sufficient to...
Stone Corporation has a defined benefit pension plan. One of its employees has vested benefits under the plan, which will pay her $30,000 annually for life starting with the first $30,000 payment on the day she retires at the age of 65. The employee has just reached the age of 45. Stone consulted standard mortality tables to come up with a life expectancy of 80 for this employee. The implicit interest rate under the plan is 9%. Required: To fulfill...
Blue, Inc. is a furniture manufacturing company with 50 employees. Recently, after a long negotiation with the local labor union, the company decided to initiate a pension plan as a part of its compensation plan. The plan will start on January 1,2017. Each employee covered by the plan is entitled to a pension payment each year after retirement. As required by accounting standards, the controller of the company needs to report the pension obligation (liability).On the basis of a discussion...
2. (5 points) Nerwin, Inc. is a furniture
manufacturing company with 50 employees. Recently, after a long
negotiation with the local labor union, the company decided to
initiate a pension plan as a part of its compensation plan. The
plan will start on January 1, 2014. Each employee covered by the
plan is entitled to a pension payment each year after retirement.
On the basis of a discussion with the supervisor of the Personnel
Department and an actuary from an...
2. (5 points) Nerwin, Inc. is a furniture
manufacturing company with 50 employees. Recently, after a long
negotiation with the local labor union, the company decided to
initiate a pension plan as a part of its compensation plan. The
plan will start on January 1, 2014. Each employee covered by the
plan is entitled to a pension payment each year after retirement.
On the basis of a discussion with the supervisor of the Personnel
Department and an actuary from an...
2. (5 points) Nerwin, Inc. is a furniture manufacturing company with 50 employees. Recently, after a long negotiation with the local labor union, the company decided to initiate a pension plan as a part of its compensation plan. The plan will start on January 1, 2014. Each employee covered by the plan is entitled to a pension payment each year after retirement. On the basis of a discussion with the supervisor of the Personnel Department and an actuary from an...
Present value. Standard Insurance is developing a long-life insurance policy for people who outlive their retirement nest egg. The policy will pay out $260,000 on your 82nd birthday. You must buy the policy on your 65th birthday The insurance company can earn 5.5% on the purchase price of your policy. What is the minimum purchase price the insurance company should charge for this policy?
Lakeland Corp. calculates that in the current year its employees earned an additional annuity of $10,000 for 20 years commencing with their retirement 12 years from today. Lakeland assumes a future interest rate of 6%. If the value of the annuity is $121,581 on the date the employees retire, what amount should be contributed today to fully fund the pension plan?
Most questions answered within 3 hours.
-
he plant started to purify its wastewater before discharging it
into the lake. How long will...
asked 32 minutes ago -
Thiazyl fluoride, F3NS is a colourless gas. Using concepts of
electronegativity, formal charge etc. determine the...
asked 35 minutes ago -
1. Why is an explicit inflation target a bad policy?
2. MV=PQ If M grows, then...
asked 8 minutes ago -
A 1.50 kg sample of water at 15.0°C is in a calorimeter. You
drop a piece...
asked 34 minutes ago -
implement a doubly-linked list in C. Each node in the linked list should contain a string,...
asked 12 minutes ago -
For the assignment this week, use Microsoft Word or Microsoft
Excel to create your own Comparing...
asked 10 minutes ago -
Pratt Company acquired all of Spider, Inc.’s outstanding shares
on December 31, 2018, for $510,100 cash....
asked 12 minutes ago -
A
firm purchased telephone equipment for cash. By mistake, the person
who recorded the transaction debited...
asked 34 minutes ago -
Sodium carbonate is added to the tea mixture, in part, to form
the sodium salt of...
asked 13 minutes ago -
Discuss the similarities and differences between static and
flexible Budgeting and Capital budgeting. · Why is...
asked 24 minutes ago -
What are some best practices and things to avoid when developing
a PowerPoint presentation or file
asked 15 minutes ago -
3. Use a text editor to create a comma-delimited file of user
IDs and passwords. Revise...
asked 17 minutes ago