Question 1

The Revenue Act of 1921 led to the increase in discretionary benefits such as pensions. (Origins of Employer-Sponsored Retirement Benefits)

Accepted Answer

A) True 
 B)False  True

Question 2

Which one of these is not a defined contribution plan? (Types of Defined Contribution Plans)

Accepted Answer

A) Cash balance plan 
B) ESOPs 
C) SIMPLE 
D) Profit sharing 
A) Cash balance plan 
B) ESOPs 
C) SIMPLE 
D) Profit sharing A

Question 3

Using the unit benefit formula,the annual benefits are based on age,years of service and final average wages or salary. (Defined Benefit Plans)

Accepted Answer

A) True 
 B)False  True

Question 4

Public organizations may offer both 40l(k)and 403(b)plans,but private tax-exempt organizations are prohibited from offering 401(k)plans. (Section 403(b)Tax-Deferred Annuity Plans)

Accepted Answer

A) True 
 B)False

Question 5

Plan termination rules apply and procedures apply to all types of pension plans. (Qualified Plans)

Accepted Answer

A) True 
 B)False

Question 6

Which of the following are characteristics of the flat benefit formula used in defined benefits plans? (Defined Benefit Plans)

Accepted Answer

A) An employee's years of service are considered, is determined using a flat amount formula or a flat percentage formula, the benefit is based on a percentage of the employees final average wage or salary 
B) Is determined using a flat amount formula or a flat percentage formula an employee's years of service are considered, the benefit is based on a percentage of the employees final average wage or salary, is based on the employee's last 3-4 years of service 
C) Is based on the employee's last 3-4 years of service an employee's years of service are considered, The benefit is based on a percentage of the employees final average wage or salary, an employee's years of service are considered 
D) The benefits are based on a percentage of the employees final average wage or salary, are based on the employee's last 3-4 years of service and are determined using a flat amount formula or a flat percentage formula 
A) An employee's years of service are considered, is determined using a flat amount formula or a flat percentage formula, the benefit is based on a percentage of the employees final average wage or salary 
B) Is determined using a flat amount formula or a flat percentage formula an employee's years of service are considered, the benefit is based on a percentage of the employees final average wage or salary, is based on the employee's last 3-4 years of service 
C) Is based on the employee's last 3-4 years of service an employee's years of service are considered, The benefit is based on a percentage of the employees final average wage or salary, an employee's years of service are considered 
D) The benefits are based on a percentage of the employees final average wage or salary, are based on the employee's last 3-4 years of service and are determined using a flat amount formula or a flat percentage formula

Question 7

Companies establish retirement plans following one of these three design configurations. (Introduction)

Accepted Answer

A) Defined benefit, defined contribution, hybrid 
B) Qualified benefit, qualified contribution, hybrid 
C) Qualified benefit, nonqualified benefit, hybrid 
D) Funded, unfunded, hybrid 
A) Defined benefit, defined contribution, hybrid 
B) Qualified benefit, qualified contribution, hybrid 
C) Qualified benefit, nonqualified benefit, hybrid 
D) Funded, unfunded, hybrid

Question 8

The IRC limit on maximum annual benefit is indexed for inflation in $7000 increments each year beginning after 2006. (Defined Benefit Plans)

Accepted Answer

A) True 
 B)False

Question 9

Usually,cash balance plans are less costly to employers than defined benefit plans. (Cash Balance Plans and Pension Equity Plans)

Accepted Answer

A) True 
 B)False

Question 10

Using the ratio percentage test for tax benefit qualification,what does the percentage of nonhighly compensated employees to highly compensated employees in the plan have to be? (Qualified Plans)

Accepted Answer

A) 30% 
B) 70% 
C) 60% 
D) 40% 
A) 30% 
B) 70% 
C) 60% 
D) 40%

Question 11

What is the 3% rule used to determine? (Defined Benefit Plans)

Accepted Answer

A) Nondiscrimination in defined benefits plans 
B) Nondiscrimination in defined contribution plans 
C) Tax benefit qualification for defined benefits plans 
D) Tax benefit qualification for defined contribution plans 
A) Nondiscrimination in defined benefits plans 
B) Nondiscrimination in defined contribution plans 
C) Tax benefit qualification for defined benefits plans 
D) Tax benefit qualification for defined contribution plans

Question 12

Nearly 55% of workers employed in the private sector participated in some form of retirement plan in 2011. (Trends in Retirement Plan Coverage Costs)

Accepted Answer

A) True 
 B)False

Question 13

These two are the basic accrual rules for the nondiscrimination testing for defined contribution plans. (Defined Contribution Plans)

Accepted Answer

A) Contributions cannot be reduced based on age, no maximum age limit for discontinuing contributions 
B) Contributions can be reduced based on age if everyone in the plan is affected, age, no maximum age limit for discontinuing contributions 
C) Contributions can be reduced based on age if everyone in the plan is affected, no minimum age limit for discontinuing contributions 
D) Contributions can be increased based on age, no maximum age limit for discontinuing contributions 
A) Contributions cannot be reduced based on age, no maximum age limit for discontinuing contributions 
B) Contributions can be reduced based on age if everyone in the plan is affected, age, no maximum age limit for discontinuing contributions 
C) Contributions can be reduced based on age if everyone in the plan is affected, no minimum age limit for discontinuing contributions 
D) Contributions can be increased based on age, no maximum age limit for discontinuing contributions

Question 14

IRC Section 403(b)established the tax-deferred annuity program as a qualified contribution plan under ERISA guidelines. (Section 403(b)Tax-Deferred Annuity Plans)

Accepted Answer

A) True 
 B)False

Question 15

Discuss the controversies related with cash balance retirement plans. (Controversy Surrounding Cash Balance Plans)

Accepted Answer

Main Points
● Age-related treatment
● Ar

Question 16

Part time workers are employed to save on costs of benefits. (Trends in Retirement Plan Coverage Costs)

Accepted Answer

A) True 
 B)False

Question 17

In nonleveraged ESOPs,the company borrows money from a financial institution to purchase company stock. (Employee Stock Option Plans (ESOPs))

Accepted Answer

A) True 
 B)False

Question 18

Pension plans do not automatically fulfill the nondiscrimination requirement if they fall in safe harbors. (Qualified Plans)

Accepted Answer

A) True 
 B)False

Question 19

Similar numbers of union and nonunion workers had access to a retirement plans as of 2011. (Trends in Retirement Plan Coverage Costs)

Accepted Answer

A) True 
 B)False

Question 20

The present value of benefits based on a designated date is known as accumulated benefit obligation. (Defined Benefit Plans)

Accepted Answer

A) True 
 B)False

The Revenue Act of 1921 led to the increase in discretionary benefits such as pensions. (Origins of Employer-Sponsored Retirement Benefits)

Which one of these is not a defined contribution plan? (Types of Defined Contribution Plans)

Using the unit benefit formula,the annual benefits are based on age,years of service and final average wages or salary. (Defined Benefit Plans)

Public organizations may offer both 40l(k)and 403(b)plans,but private tax-exempt organizations are prohibited from offering 401(k)plans. (Section 403(b)Tax-Deferred Annuity Plans)

Plan termination rules apply and procedures apply to all types of pension plans. (Qualified Plans)

Which of the following are characteristics of the flat benefit formula used in defined benefits plans? (Defined Benefit Plans)

Companies establish retirement plans following one of these three design configurations. (Introduction)

The IRC limit on maximum annual benefit is indexed for inflation in $7000 increments each year beginning after 2006. (Defined Benefit Plans)

Usually,cash balance plans are less costly to employers than defined benefit plans. (Cash Balance Plans and Pension Equity Plans)

Using the ratio percentage test for tax benefit qualification,what does the percentage of nonhighly compensated employees to highly compensated employees in the plan have to be? (Qualified Plans)

What is the 3% rule used to determine? (Defined Benefit Plans)

Nearly 55% of workers employed in the private sector participated in some form of retirement plan in 2011. (Trends in Retirement Plan Coverage Costs)

These two are the basic accrual rules for the nondiscrimination testing for defined contribution plans. (Defined Contribution Plans)

IRC Section 403(b)established the tax-deferred annuity program as a qualified contribution plan under ERISA guidelines. (Section 403(b)Tax-Deferred Annuity Plans)

Discuss the controversies related with cash balance retirement plans. (Controversy Surrounding Cash Balance Plans)

Part time workers are employed to save on costs of benefits. (Trends in Retirement Plan Coverage Costs)

In nonleveraged ESOPs,the company borrows money from a financial institution to purchase company stock. (Employee Stock Option Plans (ESOPs))

Pension plans do not automatically fulfill the nondiscrimination requirement if they fall in safe harbors. (Qualified Plans)

Similar numbers of union and nonunion workers had access to a retirement plans as of 2011. (Trends in Retirement Plan Coverage Costs)

The present value of benefits based on a designated date is known as accumulated benefit obligation. (Defined Benefit Plans)

Introducing Employee Benefits

The Psychology and Economics of Employee Benefits

Regulating Employee Benefits

Employer-Sponsored Health Insurance Programs

Employer-Sponsored Disability Insurance,life Insurance,and Workers Compensation Programs

Government-Mandated Social Security Programs

Paid Time-Off and Flexible Work Schedules

Accommodation and Enhancement Benefits

Managing the Employee-Benefits System

Nonqualified Deferred Compensation Plans for Executives

Global Employee Benefits at a Glance

Filters

Exam 4: Employer-Sponsored Retirement Plans

The Revenue Act of 1921 led to the increase in discretionary benefits such as pensions. (Origins of Employer-Sponsored Retirement Benefits)

Which one of these is not a defined contribution plan? (Types of Defined Contribution Plans)

Using the unit benefit formula,the annual benefits are based on age,years of service and final average wages or salary. (Defined Benefit Plans)

Public organizations may offer both 40l(k)and 403(b)plans,but private tax-exempt organizations are prohibited from offering 401(k)plans. (Section 403(b)Tax-Deferred Annuity Plans)

Plan termination rules apply and procedures apply to all types of pension plans. (Qualified Plans)

Which of the following are characteristics of the flat benefit formula used in defined benefits plans? (Defined Benefit Plans)

Companies establish retirement plans following one of these three design configurations. (Introduction)

The IRC limit on maximum annual benefit is indexed for inflation in $7000 increments each year beginning after 2006. (Defined Benefit Plans)

Usually,cash balance plans are less costly to employers than defined benefit plans. (Cash Balance Plans and Pension Equity Plans)

Using the ratio percentage test for tax benefit qualification,what does the percentage of nonhighly compensated employees to highly compensated employees in the plan have to be? (Qualified Plans)

What is the 3% rule used to determine? (Defined Benefit Plans)

Nearly 55% of workers employed in the private sector participated in some form of retirement plan in 2011. (Trends in Retirement Plan Coverage Costs)

These two are the basic accrual rules for the nondiscrimination testing for defined contribution plans. (Defined Contribution Plans)

IRC Section 403(b)established the tax-deferred annuity program as a qualified contribution plan under ERISA guidelines. (Section 403(b)Tax-Deferred Annuity Plans)

Discuss the controversies related with cash balance retirement plans. (Controversy Surrounding Cash Balance Plans)

Part time workers are employed to save on costs of benefits. (Trends in Retirement Plan Coverage Costs)

In nonleveraged ESOPs,the company borrows money from a financial institution to purchase company stock. (Employee Stock Option Plans (ESOPs))

Pension plans do not automatically fulfill the nondiscrimination requirement if they fall in safe harbors. (Qualified Plans)

Similar numbers of union and nonunion workers had access to a retirement plans as of 2011. (Trends in Retirement Plan Coverage Costs)

The present value of benefits based on a designated date is known as accumulated benefit obligation. (Defined Benefit Plans)

Introducing Employee Benefits

The Psychology and Economics of Employee Benefits

Regulating Employee Benefits

Employer-Sponsored Health Insurance Programs

Employer-Sponsored Disability Insurance,life Insurance,and Workers Compensation Programs

Government-Mandated Social Security Programs

Paid Time-Off and Flexible Work Schedules

Accommodation and Enhancement Benefits

Managing the Employee-Benefits System

Nonqualified Deferred Compensation Plans for Executives

Global Employee Benefits at a Glance

Filters