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daser333 [38]
3 years ago
6

An IRA uses immediate annuities to pay out benefits; the IRA owner is nearly 75 years old when he decides to collect distributio

ns. What kind of penalty would the IRA owner pay?
Business
1 answer:
soldier1979 [14.2K]3 years ago
3 0

Answer:

50% tax on the amount not distributed as required

Explanation:

In this specific scenario, the individual will have to pay a penalty of 50% tax on the amount not distributed as required. This is mainly due to the fact that traditional IRA accounts require that distribution of benefits must begin no later than age 70½ if immediate annuities are used to pay for them. Failure to do so would have a consequence of a 50% tax on the undistributed amount, and must be paid by the owner of the account.

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What is the net present value of a project with the following cash flows if the required rate of return is 9 percent? (round ans
strojnjashka [21]

Answer:

NPV= 5,493.79

Explanation:

<u>To calculate the net present value (NPV), we need to use the following formula:</u>

NPV= -Io + ∑[Cf/(1+i)^n]

Cf1= 18,708 / 1.09= 17,163.30

Cf2= 21,200 / 1.09^2= 17,843.62

Cf3= 17,800 / 1.09^3= 13,744.87

∑[Cf/(1+i)^n]= $48,751.79

NPV= -43,258 + 48,751.79

NPV= $5,493.79

4 0
2 years ago
The City issued $2 million in general obligation bonds to acquire a fleet of vehicles for the Central Motor Pool Internal Servic
nlexa [21]

Answer:

a) Bonds Payable.

Explanation:

Since there is an issue of bonds as against cash, which need to be paid back in future, amount received will be credited to bonds payable.

Further the purpose of bonds will always be to acquire a capital asset as bonds are issued for long term finance generally, therefore, the bonds will be credited as bonds payable, rather than capital contributions.

Though a general note in notes to account can be added clearly specifying the purpose of issue of bonds.

a) Bonds Payable.

6 0
3 years ago
Refer to the Article Summary. Implementing a negative interest rate policy, as is discussed in the article summary, would be des
zubka84 [21]

Answer:

Refer to the Article Summary. Implementing a negative interest rate policy, as is discussed in the article summary, would be designed to ___lower_____ the price level and ___improve_____ real GDP.

Explanation:

The Fed will consider negative interest rates when it wants to increase borrowing and lending during economic recessions.  The effects of a negative interest rate are the reduction of the cost of borrowing economy-wide and the increase of economic activity.  The increased economic activity will be achieved through increased investments and increased consumption spending.  Thus, banks and consumers are encouraged to lend and borrow more money so that the economy can spend its way out of recession.

6 0
3 years ago
You just won the grand prize in a national writing contest! As your prize, you will receive $500 a month for 50 months. If you c
nadya68 [22]

Answer:

The correct answer is B.

Explanation:

Giving the following information:

Cash flow= $500

Number of months= 50

Monthly interest rate= 0.07/12= 0.00583

First, we need to calculate the future value using the following formula:

FV= {A*[(1+i)^n-1]}/i

A= cash flow

FV= {500*[(1.00583^50) - 1]} / 0.00583

FV= $28,928.06

Now, the present value:

PV= FV/(1+i)^n

PV= 28,928.06/(1.00583^50)

PV= $21,631.67

5 0
3 years ago
The amount of goods or services that consumers are willing and able to buy is determined by
RoseWind [281]
The best answer is "C" or demand. Consumers will buy more or less depending on the demand. 

I hope this helps!
<em>~cupcake</em>
5 0
2 years ago
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