HW3 Q6.PNG

# HW3 Q6.PNG - PI:3-45(similar to a Question He Tim retired...

• Homework Help
• 1

This preview shows page 1. Sign up to view the full content.

You've reached the end of this preview.

Unformatted text preview: @ PI:3-45 (similar to) a; Question He. Tim retired during the cunent year at age 5?. He purchased an annuity from American National Life Company for \$20,000. The annuity pays Tim \$250 per month for life. 5 (Click the icon to View the Expected Return Multiple table) Requirements 3. Compute Tim's annual exclusion. b. How much income will Tim report each year after reaching age 84? Requirement a. Compute Tim's annual exclusion. Begin by computing the exclusion ratio. (Enter the answer as a decimal rounded to tour decimal places, .XXXX.) Investment in the contract I Expected return = Exclusion ratio 20,000 I 80.400 = 0.2488 Compute Tim's annual exclusion. (Enter amounts as decimals, round interim calculations to four decimal places and the annual exclusion to the nearest cent.) Annual amount received x Exclusion ratio = Annual exclusion 3,000 x 0.2488 = \$ 746.40 Requirement b. How much income will Tim report each year after reaching age 84'? The amount at income Tim will report each year after reaching age 84 will change it Tim “YE past 84 . Tim will be taxed on the entire amount he collects after his total exclusion reaches \$20,000 . ...
View Full Document

• Spring '18
• Tom Bonomo
• Accounting, Decimal, Binary-coded decimal, Tim, annual exclusion

{[ snackBarMessage ]}

### What students are saying

• As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

Kiran Temple University Fox School of Business ‘17, Course Hero Intern

• I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

Dana University of Pennsylvania ‘17, Course Hero Intern

• The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

Jill Tulane University ‘16, Course Hero Intern