Matthew (48 at year-end) develops cutting-edge technology for SV Inc., located

in Silicon Valley. In 2015, Matthew participates in SVs money purchase pension

plan (a defined contribution plan) and in his companys 401(k) plan. Under the

money purchase pension plan, SV contributes 15 percent of an employees salary

to a retirement account for the employee up to the amount limited by the tax code.

Because it provides the money purchase pension plan, SV does not contribute to

the employees 401(k) plan. Matthew would like to maximize his contribution

to his 401(k) account after SVs contribution to the money purchase plan.

a) Assuming Matthews annual salary is $60,000, what amount will SV contribute

to Matthews money purchase plan? What amount can Matthew contribute

to his 401(k) account in 2015?

b) Assume the same facts as part (c), except that Matthew is 54 years old at the end

of 2015. What amount can Matthew contribute to his 401(k) account in 2015?