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ale4655 [162]
3 years ago
14

Tim and Tammy are updating their financial plan and are concerned that they might not have enough life insurance coverage for th

eir family, which includes two children, ages 4 and 10. They have determined that their annual income is $53,000 and their net worth is now $150,000. What is the amount of life insurance they should carry using the easy method?
Business
1 answer:
VMariaS [17]3 years ago
8 0

Answer:

The amount of life insurance is $259700

Explanation:

Easy method for calculating amount of life insurance is a method for families with both spouses working, in good health, with average debt, and not more than three children. It gives an estimate of 7 years of income at 70%. Using easy method, the formula is given as:

life insurance requirement = Annual income × 7 years × 70%

Given that Annual income = $53000

amount of life insurance = $53000 × 7 years × 70% = $259700

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A large St. Louis feed mill, Robert Orwig Processing, prepares its 6-month aggregate plan by forecasting demand for 50-pound bag
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Production planning simply means the act of designing a guide for the production of a particular good or service.

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3 0
2 years ago
Which of the following are risks that Banks must prepare for select 3 answers <br><br>​
n200080 [17]

Answer:

I think one is borrowers who don't pay back

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7 0
2 years ago
In need of extra​ cash, Troy and Lily decide to withdraw ​$2 comma 100 from their traditional IRA. They are both 40 years old. T
krek1111 [17]

Answer:

Calculate the tax consequence of withdrawal from retirement account.

T and L are 40 years old and decide to withdraw $2,100 from their IRA. They lie in a 35% marginal tax bracket.

Analysis

They are withdrawing some amount from their retirement fund. They have to pay the tax and penalty for early withdrawals from the retirement fund. The withdrawal amount is $2,100 so they have to pay tax on it. The tax rate will be 35% which is their marginal tax bracket.

Calculation of tax consequences if withdrawal amount is $2,100:

Ordinary income tax amount calculates by multiplying the withdrawal amount with the ordinary tax rate.

= $2100 × 35%

= $735

The withdrawal amount attracts the 10% penalty. So, the penalty amount is calculated as follows: Penalty on withdrawn funds calculates by multiplying the withdrawn funds with the percentage of penalty.

= $2100 × 10%

= $210

(NOTE: - T and L have to pay ordinary income tax along with the penalty on their withdrawal because they are withdrawing funds from their IRA before age 59.5.)

Total expenses include the tax amount and penalty charge on withdrawal amount. So, it is calculated as follows:

Total expenses =$735 + $210

Total expenses = $945

Conclusion

Therefore, T and L would incur a tax of $945 on their withdrawal. This $945 is the sum of income tax amount and penalty on withdrawal balance.

8 0
3 years ago
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