Your company sponsors a 401(k) plan into which you deposit 12 percent of your $60,000 annual income. Your company matches 50 percent of the first 5 percent of your earnings. You expect the fund to yield 10 percent next year. Assume you are currently in the 31 percent tax bracket. a. What is the total annual investment in the 401(k) plan at year-end? (Round your answer to the nearest whole number. (e.g., 32)) b. What is your one-year return? (Round your answer to 2 decimal places. (e.g., 32.16)) a. Annual investment b. One-year return
Your company sponsors a 401(k) plan into which you deposit 12 percent of your $60,000 annual income. Your company matches 50 percent of the first 5 percent of your earnings. You expect the fund to yield 10 percent next year. Assume you are currently in the 31 percent tax bracket. a. What is the total annual investment in the 401(k) plan at year-end? (Round your answer to the nearest whole number. (e.g., 32)) b. What is your one-year return? (Round your answer to 2 decimal places. (e.g., 32.16)) a. Annual investment b. One-year return
Chapter4: Income Exclusions
Section: Chapter Questions
Problem 87TPC
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