Question: 14) Based only on the information provided for each scenario, determine whether Kristi or Cindy will benefit more from using the timing strategy and why

14) Based only on the information provided for each scenario, determine whether14) Based only on the information provided for each scenario, determine whether Kristi or Cindy will benefit more from using the timing strategy and why there will be a benefit to that person. Use Exhibit 3.1. (Round discount factor(s) to three decimal places.) a. Kristi has a 40 percent tax rate and can defer $20,000 of income. Cindy has a 30 percent tax rate and can defer $30,000 of income. b. Kristy has a 30 percent tax rate and a 10 percent after-tax rate of return and can defer $25,000 of income for three years. Cindy has a 40 percent tax rate and an 8 percent after-tax rate of return and can defer $20,000 of income for four

Rear 1 2 4 5 .6 27 4% 5% 6% 7% 8% 1_9% 10% 11% 12% 962 .952 .943 .935 .926 1917 1909 .925 .907 .890 .873 .857 .8421826 .812 797 .889 | .864 .840 .816 | .794 .772 .751 731 .712 .855 | .823 .792 .763 .735 708 .683 .659636 822 .784 .747 .713 681.650 .621-593567 .790 .746 .705 | .666 .630 .596 564 .535 1.507 ..760 .711 .665 .623583 .547 .513 .482 | .731 | .677 .627 .582 .540 .502 | .467 | -434 .703 .645 .592 544 .500 460 .424 .391 361 .676 .614 | .558 .508 .463 422 | .386 .352 .322 1.650 | .585 .527 .475 429388 350 -317 287 .625 557 .497 444 | .397 356 .319 .286 .601 .530 .469 .415 | .368 .326290 258 $77 .505 .442 | .388 .340299065 3 06 .555 48 4 174-362 315 275 289 209 THUPATHIETARAKE TenuwwwWWWWW 452 02 ..8 9 10 11 12 55 14 15 Rear 1 2 4 5 .6 27 4% 5% 6% 7% 8% 1_9% 10% 11% 12% 962 .952 .943 .935 .926 1917 1909 .925 .907 .890 .873 .857 .8421826 .812 797 .889 | .864 .840 .816 | .794 .772 .751 731 .712 .855 | .823 .792 .763 .735 708 .683 .659636 822 .784 .747 .713 681.650 .621-593567 .790 .746 .705 | .666 .630 .596 564 .535 1.507 ..760 .711 .665 .623583 .547 .513 .482 | .731 | .677 .627 .582 .540 .502 | .467 | -434 .703 .645 .592 544 .500 460 .424 .391 361 .676 .614 | .558 .508 .463 422 | .386 .352 .322 1.650 | .585 .527 .475 429388 350 -317 287 .625 557 .497 444 | .397 356 .319 .286 .601 .530 .469 .415 | .368 .326290 258 $77 .505 .442 | .388 .340299065 3 06 .555 48 4 174-362 315 275 289 209 THUPATHIETARAKE TenuwwwWWWWW 452 02 ..8 9 10 11 12 55 14 15

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