Paper Chasers, a shop that specializes in confetti has a 401(k) plan that allows plan loans...

Transcribed Image Text:

Paper Chasers, a shop that specializes in confetti has a 401(k) plan that allows plan loans up to the legal limit allowed by law. Participants must repay the loans under the most generous repayment schedule available by law. Paper Chasers plan has the following employee information: Employee/401kbal/outstanding loan Sara/200k/O Kay/250k/19,90O Judy/14k/2,000 Brian/35k/0 Which is correct: A. If Kay repays her $19,000 loan by the end of the year, she may take a loan of $50,000 anytime next year. B. Sara can borrow $100,000 (50% of her vested account balance) from her account. C. The maximum Judy can borrow from her account is $8,000. D. Brian could borrow $17,500 from his plan for the purchase of a personal residence, but he would have to repay the loan within ten years Paper Chasers, a shop that specializes in confetti has a 401(k) plan that allows plan loans up to the legal limit allowed by law. Participants must repay the loans under the most generous repayment schedule available by law. Paper Chasers plan has the following employee information: Employee/401kbal/outstanding loan Sara/200k/O Kay/250k/19,90O Judy/14k/2,000 Brian/35k/0 Which is correct: A. If Kay repays her $19,000 loan by the end of the year, she may take a loan of $50,000 anytime next year. B. Sara can borrow $100,000 (50% of her vested account balance) from her account. C. The maximum Judy can borrow from her account is $8,000. D. Brian could borrow $17,500 from his plan for the purchase of a personal residence, but he would have to repay the loan within ten years

Answer rating: 100% (QA)

Option C is correct Explanation When the balance is less than 20000 a loan ma... View the full answer