In 2019, Nitai (age 40) contributes 8 percent of his $187,000 annual salary to a Roth 401(k) account sponsored by his employer, AY Inc. AY Inc. matches employee contributions to the employee’s traditional 401(k) account dollarfordollar up to 8 percent of the employee’s salary. Nitai expects to earn a 7 percent beforetax rate of return.
Assume he leaves the contributions in the Roth 401(k) and traditional 401(k) accounts until he retires in 30 years and that he makes no additional contributions to either account. What are Nitai’s aftertax proceeds from the Roth 401(k) and traditional 401(k) accounts after he receives the distributions, assuming his marginal tax rate at retirement is 30 percent? (Use Table 1, Table 2.) (Round your intermediate calculations and final answers to the nearest whole dollar amount.)

Roth  Traditional 401(K)  
Contribution (187000*8%)  $ 14,960  $ 14,960 
FVF 7%,30  7.6123  7.6123 
Future value of contribution  $ 113,880  $ 113,880 
Less: Taxes Payable @30%  $   $ 34,164 
After tax proceeds from distribution  $ 113,880  $ 79,716 
In 2019, Nitai (age 40) contributes 8 percent of his $187,000 annual salary to a Roth 401(k) account sponsored by his em...
0 Required information The following information applies to the questions displayed below In 2018, Nina contributes 8 percent of her $83,000 annual salary to her 401(k) account. She expects to earn a 10 percent beforetax rate of return. Assuming she leaves this (and any employer contributions) in the account until she retires in 20 years, what is Nina's aftertax accumulation from her 2018 contributions to her 401(k) account? (Use Table 3. Table 4 (Round your intermediate calculations and final answers...
Kathleen, age 56, works for MH, Inc., in Dallas, Texas. Kathleen contributes to a Roth 401(k) and MH contributes to a traditional 401(k) on her behalf. Kathleen has contributed $45,120 to her Roth 401(k) over the past six years. The current balance in her Roth 401(k) account is $75,200 and the balance in her traditional 401(k) is $56,800. Kathleen needs cash because she is taking a month of vacation to travel the world. Answer the following questions relating to distributions...
In seven years, when he is discharged from the Air Force, Steve wants to buy an $29,000 power boat. Click here to view Exhibit 12B1 and Exhibit 12B2, to determine the appropriate discount factor(s) using tables. Required: What lumpsum amount must Steve invest now to have the $29,000 at the end of seven years if he can invest money at: (Round your final answers to the nearest whole dollar amount.) Present Value 1. Ten percent 2. Twelve percent
Mark received 10 ISOs (each option gives him the right to purchase 14 shares of Hendricks Corporation stock for $7 per share) at the time he started working for Hendricks Corporation five years ago when Hendricks’s stock price was $5 per share. Now that Hendricks’s share price is $35 per share, Mark intends to exercise all of his options and hold all of his shares for more than one year. Assume that more than a year after exercise, Mark sells...
Otto Co. borrows money on April 30, 2016, by promising to make four payments of $18,000 each on November 1, 2016; May 1, 2017; November 1, 2017; and May 1, 2018. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round "Table Factor" to 4 decimal places.) 1. How much money is Otto able to borrow if the interest rate is 4%, compounded semiannually? Periodic Cash Flow Table Factor...
Create the amortization schedule for a loan of $4,400, paid monthly over two years using an APR of 10 percent. Enter the data for the first three months. (Round your answers to 2 decimal places.) Month Beginning Balance Total Payment Interest Paid Principal Paid Ending Balance 1 2 3
Hankins Corporation has 6.6 million shares of common stock outstanding, 235,000 shares of 3.9 percent preferred stock outstanding, par value of $100; and 120,000 bonds with a semiannual coupon rate of 5.6 percent outstanding, par value $1,000 each. The common stock currently sells for $70 per share and has a beta of 1.10, the preferred stock has a par value of $100 and currently sells for $86 per share, and the bonds have 15 years to maturity and sell for...
The sales budget for your company in the coming year is based on a quarterly growth rate of 10 percent with the firstquarter sales projection at $225.4 million. In addition to this basic trend, the seasonal adjustments for the four quarters are 0, −$16.4, −$8.4, and $21.4 million, respectively. Generally, 40 percent of the sales can be collected within the quarter and 50 percent in the following quarter; the rest of the sales are bad debt. The bad debts are...
Howard Murphy is the owner of Stormy Banana Films in West Hollywood, California. Stormy Banana Films had 15 employees with total annual wages of $220,750 (no one exceeded the Medicare tax surcharge or Social Security cap). The FUTA rate for California in 2018 is 2.2 percent because it is a credit reduction state. Stormy Banana Films has a SUTA rate of 3.2 percent for 2018 with a wage base of $7,000. Required: Compute the following employer taxes. (Round your answers...
The management of Iroquois National Bank is considering an investment in automatic teller machines. The machines would cost $131,100 and have a useful life of seven years. The bank’s controller has estimated that the automatic teller machines will save the bank $28,500 after taxes during each year of their life (including the depreciation tax shield). The machines will have no salvage value. Net Present Value (a) 10 percent $7,638 (b) 12 percent (c) 14 percent