Problem 11-64 (LO 11-5)Terrance is age 72 and retired. Beginning in 2022, he must start taking minimum distributions from his IRA account that had a balanceof $170,000 as of December 31, 2021. Make these three assumptions: his IRA will earn 10% per year based on the annual beginningbalance, he will withdraw the minimum distribution on the last day of each calendar year, and only one distribution will be taken in2022.Required:Calculate the amount of his distribution for years 2022 through 2026 and the ending balance in his IRA account on December 31,2026. Use Table I, Table III, and Table V.Note: Round "Applicable Life Expectancy" answers to 1 decimal place and other answers to nearest whole dollar value. Use theseanswers in subsequent computations.Year20222023202420252026(1)IRA Balance AtEnd of PriorYear$ 170,000(2)ApplicableLifeExpectancy(3)RequiredDistribution(4)IRA Earnings(5)EndingBalance

The amount that owners and eligible retirement plan participants of retirement age are obliged to…

Answered: Problem 11-64 (LO 11-5) Terrance is age…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Terrance is age 71 and retired. Beginning in 2020, he must start taking minimum distributions from his IRA account that had a balance of $175,000 as of December 31, 2019. Make these three assumptions: his IRA will earn 6% per year, he will withdraw the minimum distribution on the last day of each calendar year, and only one distribution will be taken in 2020. Required: Calculate the amount of his distribution for years 2020 through 2024 and the ending balance in his IRA account on December 31, 2024. Use Table I, Table III and Table V. (Round "Applicable Life Expectancy" answers to 1 decimal place and other answers to nearest whole dollar value. Use these answers in subsequent computations.) Year. (1) IRA Balance At End of Prior Year. (2) Applicable Life Expectancy. (3) Required Distribution. (4) IRA Earnings. (5) Ending Balance 2020 2021 2022 2023 2024
1.I plan to deposit $376 into my retirement every year for the next 25 years. The first deposit will be made today (that is, at t = 0) and the last deposit will be made at the end of year 24 (that is, at t = 24). I plan to make no other deposits. Assuming that I will earn 12.13% p.a. on my retirement funds, how much money will I have accumulated 36 years from today (that is, at t = 36)? Round your answer to 2 decimal places; record your answer without commas and without a dollar sign. 2. Assume that you deposit $ 1,038 each year for the next 15 years into an account that pays 11 percent per annum. The first deposit will occur one year from today (that is, at t = 1) and the last deposit will occur 15 years from today (that is, at t = 15). How much money will be in the account 15 years from today? Round your answer to 2 decimal places; record your answer without commas and without a dollar sign.
22 Marvin plans to retire at the end of this year (2022). His expected life expectancy is 25 years after retirement. Marvin ut of has come to you, his financial advisor to learn how much he uestion should deposit on December 31, 2022 to be able to withdraw $4,000 at the end of each month for the next 25 years. Assuming the amount on deposit will earn annual interest of 2% compounded monthly, how much should Marvin deposit on December 31, 2022 in order to achieve his retirement plan? O a. $1,555,284.50 O b. S865,405.73 Oc $943,720.43 O d. $790,696,14
At age 18, someone sets up an IRA (individual retirement account) with an APR of 4%. At the end of each month he deposits $100 in the account. How much will the IRA contain when he retires at age 65? Compare that amount to the total deposits made over the time period. Question content area bottom Part 1 After retirement the IRA will contain $enter your response here. (Do not round until the final answer. Then round to the nearest cent as needed.) Part 2 The total deposits made over the time period is $enter your response here. (Type a whole number.)
You MUST use the TI BA II calculator features (N, I/Y, PV, PMT, FV, AMORT) to solve questions whenever possible. 1. Seanna O'Brien receives pension payments of $3,200 at the end of every six months from a retirement fund of $50,000. The fund earns 7% compounded semi-annually. What is the size of the final pension payment? 2. For how many years will Prasad make payments on the $28,000 he borrowed to start his machine shop if he makes payments of $3,400 at the end of every three months and interest is 8.08% compounded semi-annually?
A retired couple plans to supplement their retirement income with monthly withdrawals of the interest earned on a retirement account which has a balance of $200,000. a. If the fund earns interest monthly at an APR of 6%, which the couple always withdraws from the account, how much is generated in interest each month? Round/take your answer to the nearest cent. Recall that APR stands for Annual Percentage Rate. 24 b. Estimate (to the nearest tenth of a percent) the annual interest rate needed for this couple to be able to earn $1,350 per month in interest from this $200,000 account. Round your answer to the nearest tenth of a percent, eg., 2.5%.
A man plans to retire in 13 years. While working, he intends to deposit money each month into his retirement fund which earns 6 % interest per year, compounded monthly. He desires a million dollars in his retirement fund at the time he retires. Over the next 13 years, what amount should he deposit monthly into his retirement fund in order to accomplish his goal? Give the answer to 2 decimal places, and do not use the $ sign in the answer box. The monthly deposit amount is Blank 1. Calculate the answer by read surrounding text. dollars.
At age 24, someone sets up an IRA (individual retirement account) with an APR of 5%. At the end of each month he deposits $30 in the account. How much will the IRA contain when he retires at age 65? Compare that amount to the total deposits made over the time period. After retirement the IRA will contain $ (Do not round until the final answer. Then round to the nearest cent as needed.)
I plan to deposit $348 into my retirement every year for the next 25 years. The first deposit will be made today (that is, at t = 0) and the last deposit will be made at the end of year 24 (that is, at t = 24). I plan to make no other deposits. Assuming that I will earn 8.51% p.a. on my retirement funds, how much money will I have accumulated 36 years from today (that is, at t = 36)? Round your answer to 2 decimal places; record your answer without commas and without a dollar sign. Your Answer: Answer
NO2.5 Daryl wishes to save money to provide for his retirement. He is now 30 years old and will be retiring at age 64. Beginning one month from now, he will begin depositing a fixed amount into a retirement savings account that will earn 12% compounded monthly. Then one year after making his final deposit, he will withdraw $100,000 annually for 25 years. In addition, and after he passes away (assuming he lives 25 years after retirement) he wishes to leave in the fund a sum worth $1,000,000 to his nephew who is under his charge. The fund will continue to earn 12% compounded monthly. How much should the monthly deposits be for his retirement plan?
Accounting Marvin plans to retire at the end of this year (2022). His expected life expectancy is 25 years after retirement. Marvin has come to you, his financial advisor to learn how much he should deposit on December 31, 2022 to be able to withdraw $4,000 at the end of each month for the next 25 years. Assuming the amount on deposit will earn annual interest of 2% compounded monthly, how much should Marvin deposit on December 31, 2022 in order to achieve his retirement plan? a. $865,405.73 b. $1,555,284.50 c. $943,720.43 d. $790,696.14
The worker aged 45 wishes to accumulate a fund for retirement by depositing 100EUR at the beginning of each month for 20 years. Starting at age 65 the worker plans to make monthly withdrawal at the beginning of each month for next 15 years. Assuming that each payments are certain to be made, find the amount of each withdrawal if the effective rate of interest is 5% during the first 10 years but only 3% thereafter. Also, solve this problem assuming that he will spend 4000EUR being exactly 65.

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