1. Bianca is a wealthy widow and a doting grandmother. Bianca would like to do as much as possible to help her 18-year-old granddaughter Esmerelda with college expenses. Esmerelda will be attending a private college this fall and the tuition will be $24,000 per year. Esmerelda expects to graduate in 4 years. Room and board will cost an additional 11,000 per year. Which of the following will allow Bianca to provide the most financial assistance that is free from both gift tax and generation-skipping transfer tax?

		A. Contribute $140,000 to a Section 529 plan and elect front-loading.
		B. Gift $140,000 of highly appreciated stock directly to Esmerelda this year.
		C. Contribute $70,000 to an ESA and elect front-loading.
		D. Pay the $24,000 tuition directly to the school and write a check to Esmerelda for $11,000 each year.

2. Stephanie and Chip want to fund their 8-year-old son Thorntons college education. The current cost of tuition is $10,000 per year and they expect it to increase 6% per year. They also anticipate earning 5% per year on their investments. Approximately how much do they need to save at the end of each month to fund five years of college for Thornton?

		A. $581
		B. $585
		C. $588
		D. $592

3. Luis took a $2,000 distribution from his UTMA to pay his fraternity dues for the school year. What is the amount of his penalty?

		A. $0
		B. $100
		C. $150
		D. $200

4.

Melia wants to open a full service Day Spa in five years. She anticipates needing $250,000 to build the store and cover opening expenses. If she can earn 6% on her investments, how much does she need to save at the end of each month to achieve her goal?

A.		$3,548
B.		$3,565
C.		$3,583
D.		$3,600