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[The following information applies to the questions displayed below.]
In 2019, Nina contributes 10 percent of her $100,000 annual salary to her 401(k) account. She expects to earn a 7 percent before-tax rate of return. Assuming she leaves this (and any employer contributions) in the account until she retires in 25 years, what is Nina’s after-tax accumulation from her 2019 contributions to her 401(k) account? (Use Table 1, Table 2.) (Round your intermediate calculations and final answer to the nearest whole dollar amount.)
a. Assume Nina’s marginal tax rate at retirement is 30 percent.
After tax proceeds from distribution$____
b. Assume Nina’s marginal tax rate at retirement is 20 percent.
After tax proceeds from distribution$____
c. Assume Nina’s marginal tax rate at retirement is 40 percent.
After tax proceeds from distribution$____
a | b | c | |
Before tax contribution |
10,000 | 10,000 | 10,000 |
Time future value factor (1.07^25) | 5.42743 | 5.42743 | 5.42743 |
Future value of contribution | 54,274 | 54,274 | 54,274 |
Tax % | 30% | 20% | 40% |
Less:Taxes payable on distribution | 16,282 | 10,855 | 21,710 |
After tax proceeds from distribution | 37,992 | 43,419 | 32,565 |
Required information [The following information applies to the questions displayed below.] In 2019, Nina contributes 10...
0 Required information The following information applies to the questions displayed below In 2018, Nina contributes 8 percent of her $83,000 annual salary to her 401(k) account. She expects to earn a 10 percent before-tax rate of return. Assuming she leaves this (and any employer contributions) in the account until she retires in 20 years, what is Nina's after-tax accumulation from her 2018 contributions to her 401(k) account? (Use Table 3. Table 4 (Round your intermediate calculations and final answers...
0 Required information The following information applies to the questions displayed below In 2018, Nina contributes 8 percent of her $83,000 annual salary to her 401(k) account. She expects to earn a 10 percent before-tax rate of return. Assuming she leaves this (and any employer contributions) in the account until she retires in 20 years, what is Nina's after-tax accumulation from her 2018 contributions to her 401(k) account? (Use Table 3. Table 4 (Round your intermediate calculations and final answers...
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Required information The following information applies to the questions displayed below.) In 2019, Maggy (34 years old) is an employee of YBU Corp.YBU provides a 401(k) plan for all its employees. According to the terms of the plan, YBU contributes 50 cents for every dollar the employee contributes. The maximum employer contribution under the plan is 15 percent of the employee's salary (if allowed, YBU contributes until the employee has contributed 30 percent of her salary). (Use Exhibit 13-2) a....
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