After your recent meeting with Clint Barton (45), Clint wants to know whether he has made...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
After your recent meeting with Clint Barton (45), Clint wants to know whether he has made sufficient provision for his retirement at age 65 His retirement needs and wishes are as follows. • Clint has calculated that, during retirement he needs to receive an after-tax income of R280 000 per annum in order to sustain his current lifestyle. His retirement income must increase annually in line with inflation. • He would like his income after retirement to be provided until he reaches age 80. He has made the following provisions for his retirement. • Clint is a member of his employer's pension fund. The employer currently contributes R35 000 per annum to the fund and Clint contributes R30 000 per annum to the fund of which 3% goes towards the administration of the fund • Contributions are expected to increase at the inflation rate. The following assumptions are made. • All regular investments, instalments and income are payable arinually in advance • The net return on all investments prior to retirement is 12% per annum. The net return on all investments after retirement is 10% per annum. Any annual investments made to negate a shortfall that could exist at retirement will escalate at 9% per annum . The annual inflation rate is 7% throughout Clint's marginal tax rate is 30% Calculate the value of the contributions to Clint's retirement fund: . After your recent meeting with Clint Barton (45), Clint wants to know whether he has made sufficient provision for his retirement at age 65 His retirement needs and wishes are as follows. • Clint has calculated that, during retirement he needs to receive an after-tax income of R280 000 per annum in order to sustain his current lifestyle. His retirement income must increase annually in line with inflation. • He would like his income after retirement to be provided until he reaches age 80. He has made the following provisions for his retirement. • Clint is a member of his employer's pension fund. The employer currently contributes R35 000 per annum to the fund and Clint contributes R30 000 per annum to the fund of which 3% goes towards the administration of the fund • Contributions are expected to increase at the inflation rate. The following assumptions are made. • All regular investments, instalments and income are payable arinually in advance • The net return on all investments prior to retirement is 12% per annum. The net return on all investments after retirement is 10% per annum. Any annual investments made to negate a shortfall that could exist at retirement will escalate at 9% per annum . The annual inflation rate is 7% throughout Clint's marginal tax rate is 30% Calculate the value of the contributions to Clint's retirement fund: .
Expert Answer:
Answer rating: 100% (QA)
Cal cul ate the value of the contributions to Clint s retirement fund ANS WER The value of the contr... View the full answer
Related Book For
Business Communication Essentials a skill based approach
ISBN: 978-0132971324
6th edition
Authors: Courtland L. Bovee, John V. Thill
Posted Date:
Students also viewed these accounting questions
-
An economic researcher wants to know whether he can reject the null hypothesis, at the 10% significance level, that no more than 20% of the households in Pennsylvania make more than $70,000 per year....
-
A company that sells sunscreen products wants to know whether there is a relationship between people's hair colour and their tendency to apply sunscreen before going outside. For example, it may be...
-
A producer of steel cables wants to know whether the steel cables it produces have an average breaking strength of 5000 pounds. An average breaking strength of less than 5000 pounds would not be...
-
IKEA was founded in 1943 by a 17-year-old Swede named Ingvar Kamprad. The company, which initially sold pens, Christmas cards, and seeds from a shed on Kamprad?s family farm, eventually grew into a...
-
Bonds Payable has a balance of $900,000 and Premium on Bonds Payable has a balance of $10,000. If the issuing corporation redeems the bonds at 103, what is the amount of gain or loss on redemption?...
-
Let the following functions represent the three fractional velocities of the flow: where k is a constant. Which cases represent incompressible flow. (1) u=kx, v = -ky, w = 0 (2) u=kx, v=-ky, w=kx (3)...
-
Jsing the appropriate table, determine the sample size in each of the following situations: SAMPLING FOR ATTRIBUTES Expected Population Occurrence Rate (%) 32412 65743 2 Reliability Upper Precision...
-
What changed firstthe Starbucks customer or the Starbucks Experience? Explain your response by discussing the principles of market targeting. By now, you should be familiar with the Starbucks story....
-
The Green Mortgage Company has originated a pool containing 75 ten-year fixed interest rate mortgages with an average balance of $102,600 each. All mortgages in the pool carry a coupon of 12 percent....
-
Company A is a global company based in the United States that operates in the financial industry. Company A serves its customers with financial products, such as checking accounts, bank cards, and...
-
Explain how a competitive firm reaches a decision to temporarily shut down its business on the basis of its Average Variable Cost (AVC) and makes a decision to exit the market altogether on the basis...
-
Find the binomial probabilities in Problems 3-10. \(n=15, X=13, p=0.40\)
-
When you use the Pan tool you are actually moving the drawing, not just changing what part of the drawing you can see on the screen. A) True B) False
-
What tool will break a wall into two smaller pieces? Answer:
-
A friend says she has two new baby cats to show you, but she doesn't know whether they're both male, both female, or a pair. You tell her that you want only a male, and she telephones the vet and...
-
Revit is strictly a 2D drafting program. A) True B) False
-
You need to schedule 10 units of product Alpha for delivery in 6 weeks Three units of D and 2 units of F are required for each Alpha. The lead time for Alpha is 1 week Lead time for D is 1 week, and...
-
Assume you are the accountant for Catalina Industries. John Catalina, the owner of the company, is in a hurry to receive the financial statements for the year ended December 31, 20X1, and asks you...
-
For each of the following communication tasks, state a specific purpose (if you have trouble, try beginning with "I want to . . . "). 1. A report to your boss, the store manager, about the outdated...
-
Visit any restaurant, possibly your school cafeteria. The workers and fellow customers will assume that you are an ordinary customer, but you are really a spy for the owner. Your task After your...
-
You chose your college or university based on certain expectations, and you've been enrolled long enough now to have some idea about whether those expectations have been met. In other words, you are...
-
The cable has a mass of \(0.5 \mathrm{~kg} / \mathrm{m}\) and is \(25 \mathrm{~m}\) long. Determine the vertical and horizontal components of force it exerts on the top of the tower. B 30 15 m
-
The beams \(A B\) and \(B C\) are supported by the cable that has a parabolic shape. Draw the shear and moment diagrams for members \(A B\) and \(B C\). The hanger at \(B\) is attached to member \(A...
-
A cable has a weight of \(3 \mathrm{lb} / \mathrm{ft}\) and is supported at points that are \(500 \mathrm{ft}\) apart and at the same elevation. If it has a length of \(600 \mathrm{ft}\), determine...
Study smarter with the SolutionInn App