Upon retirement, Geraldine will receive a lump sum of 666,666 but opted to receive instead a perpetuity. At 6%, find the perpetual payments; (A) at the beginning of each year; (B) due after 6 years; (C) at the end of each year.
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- Robert Provider purchases a joint and survivor annuity providing for payments of $200 per month for his life and upon his death for his wife, Robin, for the remainder of her life. As of the annuity starting date Robert is 68 and Robin is 66. The annuity cost Robert $36,000. Determine the exclusion ratio for the annuity.John's estate is to be divided into three equal parts and invested, to be paid out as follows: i. John's two children will each receive their share in 20 level annual payments, beginning one year after John's death. ii. Charity Q will receive its share as equal annual payments in perpetuity beginning 21 years after John's death. Q's annual payment is twice the annual payment for one child. Determine the effective interest rate at which the estate is invested. Less than 5% At least 5% but less than 5.25% At least 5.25% but less than 5.5o% At least 5-50% but less than 5.75% At least 5.75%Juanita paid a life insurer $60,100 in exchange for an immediate life annuity. Juanita will receive $600 per month from the insurer, and her life expectancy is 14 years. Assume that Juanita receives 12 monthly payments in the first year. How much taxable income must she report? (Round your answer to 2 decimal places)
- On January 1, 1988, Felix inherited a perpetuity with annual payments beginning in six months. The first payment was $5,000, and after that the payments increased by 4% each year. Find the value of this perpetuity on January 1, 1995 if the annual effective interest rate was 7% from January 1, 1988 through January 1, 1996 and 6% thereafter. (Round your answer to the nearest cent. ) answer is $389486.63. please show workMadelaine has $1 million as a lump sum in her superannuation when she retires in at 65 years old. The superannuation account offers her an average interest rate of 6% per annum compounded semi-annually over the next 25 years. What amount she can withdraw at the end of each term? How much interest she could earn? Only typed AnswerLola, age 64 began receiving $1,200 as a monthly annuity in 2019 when her husband died. She received nine payments in 2019. Her husband contributed $54,800 to a qualified employee plan. Use the Simplified Method Worksheet (See image) to calculate Lola’s taxable amount from the annuity. (Show all computations)
- l wishes to provide herself, or her estate, with an income of $10,000 at the end of each year for 10 years. She will make a lump sum deposit when the account is established and add $3000 at the end of each year for 12 years. The income is to start at the end of the year following the year in which the last deposit was made. Compute the lump sum deposit. (All interest rates are 7 Percent Compounded annually)On January 1, Alex received an inheritance of a thirty-year annuity. Starting on the day of the inheritance, the annuity pays $1,000 each January 1, $2,000 each April 1, $1,500 each July 1, and $5000 each October 1. (a) Using i = 5%, calculate the value of this inheritance on the day Alex inherits it. (Round your answer to the nearest cent.) $ (b) If the value on the day she inherits it is $140,000, find the annual effective rate i used to calculate this value to the nearest hundredth of a percent. %Anne purchased an annuity from an insurance company that promised to pay her $17,000 per year for the next 10 years. Anne paid $130,050 for the annuity, and in exchange she will receive $170,000 over the term of the annuity. Required: a. How much of the first $17,000 payment should Anne include in gross income? Note: Do not round intermediate calculations. b. How much income will Anne recognize over the term of the annuity?
- Jessica retired at age 65. On the date of her retirement, the balance in her traditional IRA was $217,000. Over the years, Jessica had made $21,700 of nondeductible contributions and $68,500 of deductible contributions to the account. If Jessica receives a $67,000 distribution from the IRA on the date of retirement, what amount of the distribution is taxable? Multiple Choice $0. $6,700. $50,250. $60,300. $67,000.In 18 years, Maggie Beechwood is to receive $100,000 under the terms of a trust established by her grandparents. Assuming an interest rate of 5.7%, compounded continuously, what is the present value of Maggie's legacy? The present value of the legacy is $ (Round to the nearest cent as needed.)1. Armando retired when he was 58 years old and began receiving annuity. The annuity pays him $800 per month for life from a qualified retirement plan from his former employer. The annuity began in on January 1, 2020. His investment in the annuity contract was $90,000. What is the amount of Armando's taxable income from this annuity contract for 2023? Show your work. Taxable amount for 2023 2. If Armando dies in 2049, what would be his taxable income from this annuity in tax year 2048? Taxable amount for 2048