Problem 5-43 (LO. 2,5) Bertha is considering taking an early retirement offered by her employer. She...

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Problem 5-43 (LO. 2,5) Bertha is considering taking an early retirement offered by her employer. She would receive $3,000 per Disposable income associated with employment Less: Disposable income associated with retirement in disposable income

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Answer 1

Answer #1

Answer :

Particular	Now	Retired
Salary / Retirement	$55000	$36000 ($3000*12)
Less: Community and Clothing Costs	($3600)	0
Less: Social security and Medicare tax	($4208)	0
Less: Insurance Medical	-	($8000)
Less: Marginal Tax Bracket	($8875)	($4125)
After tax income	$38317	$23875

Particulars	Amount
Disposable income related with the employment	$38317
Less: Disposable income related with the retirement	($23875)
Decline underlying disposable income	$14442

Hence, it is clear from the above table that disposal income shall decrease by $14442 on account of retirement..

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