Question 1

Which of the following statements about Section 401(k)plans is true?

Accepted Answer

A) Elective salary deferrals to these plans are free of federal income taxation until the funds are actually withdrawn. 
B) These plans are exempt from rules that prevent discrimination in favor of highly compensated employees. 
C) There is no limit on the actual percentage of salary that can be deferred by highly compensated employees under a qualified plan. 
D) If an employee takes the funds made available to him or her in cash,the money received is not taxable. 
A) Elective salary deferrals to these plans are free of federal income taxation until the funds are actually withdrawn. 
B) These plans are exempt from rules that prevent discrimination in favor of highly compensated employees. 
C) There is no limit on the actual percentage of salary that can be deferred by highly compensated employees under a qualified plan. 
D) If an employee takes the funds made available to him or her in cash,the money received is not taxable.

Question 2

Which of the following distributions from a qualified retirement plan would be exempt from the 10 percent penalty tax if the distribution occurred before the covered employee was age 59.5?
I.A distribution made to an employee with a qualifying disability.
II.A distribution made to a beneficiary or to the employee estate's after the employee's death.

Accepted Answer

A) I only 
B) II only 
C) both I and II 
D) neither I nor II 
A) I only 
B) II only 
C) both I and II 
D) neither I nor II

Question 3

JKL Company just converted its traditional defined-benefit plan to another type of plan.Under the plan,benefits are defined in terms of a hypothetical account balance,with retirement benefits dependent upon the value of the participant's account at retirement.Each year,employees receive an interest rate credit and a pay credit which is a specified percentage of compensation.This type of plan is called a

Accepted Answer

A) section 401(k)plan. 
B) deposit-administration plan. 
C) cash-balance plan. 
D) trust fund plan. 
A) section 401(k)plan. 
B) deposit-administration plan. 
C) cash-balance plan. 
D) trust fund plan.

Question 4

Which of the following requirements must be met by a top-heavy pension plan to retain its qualified status?
I.A special rapid vesting schedule must be used for non-key employees.
II.Certain minimum benefits or contributions must be provided for non-key employees.

Accepted Answer

A) I only 
B) II only 
C) both I and II 
D) neither I nor II 
A) I only 
B) II only 
C) both I and II 
D) neither I nor II

Question 5

ABC Company offers a qualified retirement plan.ABC selected a funding instrument with an insurer in which the insurer guarantees a relatively high interest rate for a number of years on a lump sum deposit.This funding instrument is called a

Accepted Answer

A) trust-fund plan. 
B) group deferred annuity. 
C) separate investment account. 
D) guaranteed investment contract. 
A) trust-fund plan. 
B) group deferred annuity. 
C) separate investment account. 
D) guaranteed investment contract.

Question 6

Which of the following statements concerning defined contribution pension plans is (are)true?
I.The contribution rate is fixed.
II. The retirement benefit varies.

Accepted Answer

A) I only 
B) II only 
C) both I and II 
D) neither I nor II 
A) I only 
B) II only 
C) both I and II 
D) neither I nor II

Question 7

Early distributions from qualified retirement plans are assessed a 10 percent penalty tax.However,there are some exceptions to this rule.All of the following distributions would be exempt from the penalty tax EXCEPT

Accepted Answer

A) distributions made after age 59.5. 
B) distributions made when an employee of any age changes employers. 
C) distributions made after the death or permanent disability of the employee. 
D) distributions that are part of a series of substantially equal payments over the worker's life expectancy. 
A) distributions made after age 59.5. 
B) distributions made when an employee of any age changes employers. 
C) distributions made after the death or permanent disability of the employee. 
D) distributions that are part of a series of substantially equal payments over the worker's life expectancy.

Which of the following statements about Section 401(k)plans is true?

Which of the following requirements must be met by a top-heavy pension plan to retain its qualified status? I.A special rapid vesting schedule must be used for non-key employees. II.Certain minimum benefits or contributions must be provided for non-key employees.

ABC Company offers a qualified retirement plan.ABC selected a funding instrument with an insurer in which the insurer guarantees a relatively high interest rate for a number of years on a lump sum deposit.This funding instrument is called a

Which of the following statements concerning defined contribution pension plans is (are)true? I.The contribution rate is fixed. II. The retirement benefit varies.

Early distributions from qualified retirement plans are assessed a 10 percent penalty tax.However,there are some exceptions to this rule.All of the following distributions would be exempt from the penalty tax EXCEPT

Risk and Its Treatment

Insurance and Risk

Introduction to Risk Management

Advanced Topics in Risk Management

Types of Insurers and Marketing Systems

Insurance Company Operations

Financial Operations of Insurers

Government Regulation of Insurance

Fundamental Legal Principles

Analysis of Insurance Contracts

Life Insurance

Life Insurance Contractual Provisions

Buying Life Insurance

Annuities and Individual Retirement Accounts

Health-Care Reform; Individual Health Insurance Coverages

Employee Benefits: Group Life and Health Insurance

Social Insurance

The Liability Risk

Homeowners Insurance,section I

Homeowners Insurance,section II

Auto Insurance

Auto Insurance and Society

Other Property and Liability Insurance Coverages

Commercial Property Insurance

Commercial Liability Insurance

Crime Insurance and Surety Bonds

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Exam 17: Employee Benefits: Retirement Plans

Which of the following statements about Section 401(k)plans is true?

Which of the following requirements must be met by a top-heavy pension plan to retain its qualified status? I.A special rapid vesting schedule must be used for non-key employees. II.Certain minimum benefits or contributions must be provided for non-key employees.

ABC Company offers a qualified retirement plan.ABC selected a funding instrument with an insurer in which the insurer guarantees a relatively high interest rate for a number of years on a lump sum deposit.This funding instrument is called a

Which of the following statements concerning defined contribution pension plans is (are)true? I.The contribution rate is fixed. II. The retirement benefit varies.

Early distributions from qualified retirement plans are assessed a 10 percent penalty tax.However,there are some exceptions to this rule.All of the following distributions would be exempt from the penalty tax EXCEPT

Risk and Its Treatment

Insurance and Risk

Introduction to Risk Management

Advanced Topics in Risk Management

Types of Insurers and Marketing Systems

Insurance Company Operations

Financial Operations of Insurers

Government Regulation of Insurance

Fundamental Legal Principles

Analysis of Insurance Contracts

Life Insurance

Life Insurance Contractual Provisions

Buying Life Insurance

Annuities and Individual Retirement Accounts

Health-Care Reform; Individual Health Insurance Coverages

Employee Benefits: Group Life and Health Insurance

Social Insurance

The Liability Risk

Homeowners Insurance,section I

Homeowners Insurance,section II

Auto Insurance

Auto Insurance and Society

Other Property and Liability Insurance Coverages

Commercial Property Insurance

Commercial Liability Insurance

Crime Insurance and Surety Bonds

Filters