Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Financial Accounting Expert

problem1. Eleanor requires $40,000 a year to live on in retirement net of the income she will get. She will be retiring in 22 years and is funding for 25-year retirement. The inflation rate is anticipated to be 3.5 percent a year and the after-tax return on her investments percent.

a. How much will the short fall amount to at beginning of retirement period?

b. What lump sum will she need at beginning of retirement period?

c. What is the required annual savings?

problem2. Frank, age 28, wants to compute his resources in real (inflation-adjusted) terms. find out the amount of resources made accessible by age 65 retirements if $18,000 a year is saved. Suppose that outflows from ages 65 to 90 are at the rate of $27,000 a year. The projected inflation rate is 4 percent, and the expected investment return is 6 percent.

a. How much in new savings will Frank have accessible at age 65 before subsequent withdrawals?

b. How much will he have left at an age 90?

c. What is the present value of that sum at an age 65?

d. How much will he have to save per year to exactly meet his requirements?

problem3
. The smiths had $110,000 in savings at age 51. They had a desired retirement age of 65. They desire to fund through age 92. Suppose a 4 percent inflation rate and a 5 percent after-tax rate for investment both pre- and postretirement. They have household income of $140,000, which is rising at the rate of inflation. Their expenditures consisting of taxes are $125,000 a year. They estimate that in retirement they will get $28,000 a year together in Social Security and Mr. Smith will receive a $12,000-a-year pension, both in today’s dollars. Their retirement expenses would be $90,000 a year in today’s dollars.

1. find out:

a. The lump sum needed at retirement.

b. Current assets available at retirement

c. Annual savings required.

d. The differentiation between needs and resources.

2. Analysis:

a. Is their retirement plan attainable as is?

b. If not, what are the alternatives which could help reconcile needs and resources?

c. What is your recommendation?

Financial Accounting, Accounting

  • Category:- Financial Accounting
  • Reference No.:- M93292
  • Price:- $70

Priced at Now at $70, Verified Solution

Have any Question? 


Related Questions in Financial Accounting

Need at least 750 wordsprepare and submit a report about

Need at least 750 words Prepare and submit a report about any government process which has been re engineered using IT like E-gate in the airport. Discuss the strategies of change management that you think was applied to ...

Module two financial statement analysis worksheetthe main

Module Two Financial Statement Analysis Worksheet The main goal of financial statement analysis is to use past and current performance to identify changes and trends that will affect a company. Financial ratios are a wid ...

What projects can restore the rights and dignity of people

What Projects can restore the rights and dignity of people and societies who may be, or are forced into motion due to social injustices, politics, economic pressures, climate change and war.

Question 1 which of the following results in an increase in

Question 1. Which of the following results in an increase in the investment account using the equity method? Unrealized gain on intercompany inventory transfers for the current year Sale of a portion of the investment du ...

Project part i peyton approved - budget variance reportyou

Project Part I Peyton Approved - Budget Variance Report You are a manager for Peyton Approved, a pet supplies manufacturer. This responsibility requires you to create budgets, make pricing decisions, and analyze the resu ...

Assignemntdilithium batteries is a division of enterprise

Assignemnt Dilithium Batteries is a division of Enterprise Corporation. The division manufactures and sells a long-life battery used in a wide variety of applications. During the coming year it expects to sell 60,000 uni ...

Assignmentthe company is premier inc that needs to be usedi

Assignment The company is Premier Inc. that needs to be used. I will need a 3-4 pageanalysis and a Power Point presentation (no more than 10 slides) Write your paper, read carefully, and consider possible edits and chang ...

Mr great kid an experienced budget analyst at toysforall

Mr. "Great" Kid, an experienced budget analyst at ToysForAll Manufacturing company, has been charged with assessing the firm's financial performance during 2014 and its financial position at year end 2014. To complete th ...

Assignmentalto company consists of the red river division

Assignment Alto Company consists of the Red River Division and the White Mountain Division. Red River produces and sells 100 pound bags of pottery clay which can either be sold to outside customers or to White Mountain. ...

How does carr characterize the difference between

How does Carr characterize the difference between infrastrctural technology and proprietary technology? Can proprietary technologies be used for long term strategic advantage? What is an example of a company proprietary ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro

Describe what you learned about the impact of economic

Describe what you learned about the impact of economic, social, and demographic trends affecting the US labor environmen