Lorraine and Peter are evaluating their life insurance needs. Peter makes $3,500 per month after tax,...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Lorraine and Peter are evaluating their life insurance needs. Peter makes $3,500 per month after tax, and Lorraine clears $1,200 per week after tax. Lorraine and Peter just had a new baby boy and while Peter already has life insurance, Lorraine does not. With the birth of their new baby, they have just completed a household budget and estimate that they will have total household expenses of $6,200 per month going forward, Lorraine would like to purchase an insurance policy to protect their family in the event of her death. She estimates the money would be needed until her son reaches age 25, at which point she assumes he would be financially independent and Peter would be retired. Using the capital drawdown method, which of the following is the CORRECT amount of life insurance Lorraine should buy? $67,500 $420,000 $810,000 $1,860,000 Lorraine and Peter are evaluating their life insurance needs. Peter makes $3,500 per month after tax, and Lorraine clears $1,200 per week after tax. Lorraine and Peter just had a new baby boy and while Peter already has life insurance, Lorraine does not. With the birth of their new baby, they have just completed a household budget and estimate that they will have total household expenses of $6,200 per month going forward, Lorraine would like to purchase an insurance policy to protect their family in the event of her death. She estimates the money would be needed until her son reaches age 25, at which point she assumes he would be financially independent and Peter would be retired. Using the capital drawdown method, which of the following is the CORRECT amount of life insurance Lorraine should buy? $67,500 $420,000 $810,000 $1,860,000
Expert Answer:
Related Book For
Managerial Accounting An Introduction to Concepts Methods and Uses
ISBN: 978-0324639766
10th Edition
Authors: Michael W. Maher, Clyde P. Stickney, Roman L. Weil
Posted Date:
Students also viewed these accounting questions
-
The Crazy Eddie fraud may appear smaller and gentler than the massive billion-dollar frauds exposed in recent times, such as Bernie Madoffs Ponzi scheme, frauds in the subprime mortgage market, the...
-
Managing Scope Changes Case Study Scope changes on a project can occur regardless of how well the project is planned or executed. Scope changes can be the result of something that was omitted during...
-
Planning is one of the most important management functions in any business. A front office managers first step in planning should involve determine the departments goals. Planning also includes...
-
The National Health Statistics Reports dated Oct. 22, 2008, included the following information on the heights (in.) for non-Hispanic white females: a. Calculate and interpret a confidence interval at...
-
Describe factors affecting the work environment that must be considered in work systems design.
-
Direct Assurance Company revised the estimates of the useful life of a trademark it had acquired three years earlier. How should Direct account for the change?
-
2. ETHICS Hector works in Zoey's importing firm. Zoey overhears Hector on the phone say, "O.K., 30,000 ski parkas at $80 per parka. You've got yourself a deal. Thanks a lot." When Hector hangs up,...
-
Knitpix Products is a division of Parker Textiles Inc. During the coming year, it expects to earn income of $310,000 based on sales of $3.45 million; without any new investments, the division will...
-
A 66-day Treasury bill is quoted as having a 6.03% bond equivalent yield. What is the T-bill's effective annual ya
-
Liquid extraction is an operation used to separate the components of a liquid mixture of two or more species. In the simplest case, the mixture contains two components: a solute (A) and a Liquid...
-
Mr. Li, a Chinese citizen, is an employee in NICE company. Mr. Li had the following income for the month of January 2019: (1) Monthly employment income from NICE company is RMB 14,500, and a bonus...
-
improve script. This is supposed to ping each host twice in a subnet and only print those that are active. import os network = input ("Enter first 3 numbers of IP network, e.g. 1.2.3: ")...
-
Question 2: Poverty and Inequality in Devoland Consider the following table summarizing the distribution of income in Devoland: Individual 1 Income (in econs) 1 2 10 3 42 4 58 5 73 6 97 7 166 8 230 9...
-
what kind of training plan is needed to help employees engage with a new digital tool like project management software? What are some of the associated costs for the system implementation? Provide an...
-
[The following information applies to the questions displayed below.] Blackwood Industries manufactures die machinery. To meet its expansion needs, it recently (2020) acquired one of its suppliers,...
-
Definition of training and development and training is usually conducted for different purposes some of the popular types of training.?
-
Calvin Johnson has a $4 comma 500 4,500 debt balance on his Visa card that charges 17.9 17.9 percent APR compounded monthly. In2009, Calvin's minimum monthly payment is 3 3 percent of his...
-
Suppose that fraction used = / 1.0 + 0.1Mt. for some parameter 1. Write the discrete-time dynamical system and solve for the equilibrium. Sketch a graph of the equilibrium as a function of ....
-
Inventory management problems usually involve two types of opposing costs. Describe these costs and sketch a graph showing how they change as order size changes. (Put order size on the horizontal...
-
Seuss Companys budget contains the following standards: Material---2 Pounds at $.50 per Pound per Unit of Output ..................... $1.00 Direct Labor---1 Hour at $9.00 per Unit of...
-
Wafers, Inc., processes silicon crystals into purified wafers and chips. Silicon crystals cost $60,000 per tank-car load. The process involves heating the crystals for 12 hours, producing 45,000...
-
Five diners decide to split the check evenly. The total bill comes to \(\$ 475\). How much does each diner owe?
-
Consider the function \(u=\sin x\). Apply the forward difference (4.4), backward difference (4.9), and central difference (4.10) to evaluate the derivative \(d u / d x\) at \(x=1.0\). Use the uniform...
-
Write the schemes similar to (4.4), (4.9), and (4.10) for \(\partial u /\left.\partial y ight|_{i, j}\).
Study smarter with the SolutionInn App