View the step-by-step solution to:

Question

Thomas, age 55 and the owner of a computer repair shop, has come to you to establish a qualified plan. The repair

shop, which employs mostly young employees, has had steady cash flows over the past few years, but Thomas foresees shaky cash flows in the future as new computer prices decline. Thomas would like to allocate as much of the plan contributions to himself as possible. He is the only employee whose compensation is in excess of $100,000. Which of the following qualified plans would you advise Thomas to establish?

  1. Profit sharing plan
  2. Defined benefit pension plan
  3. Cash balance pension plan
  4. Money purchase pension plan (Integrated)



I thought it was answer 4. which was wrong... HELP

Top Answer

Given that the company is not sufficient cash flows... View the full answer

Sign up to view the full answer

Why Join Course Hero?

Course Hero has all the homework and study help you need to succeed! We’ve got course-specific notes, study guides, and practice tests along with expert tutors.

  • -

    Study Documents

    Find the best study resources around, tagged to your specific courses. Share your own to gain free Course Hero access.

    Browse Documents
  • -

    Question & Answers

    Get one-on-one homework help from our expert tutors—available online 24/7. Ask your own questions or browse existing Q&A threads. Satisfaction guaranteed!

    Ask a Question