Reference no: EM131203355
Benedict’s Retirement Planning
Benedict is 37 years old and would like to establish a retirement plan. Develop a spreadsheet model that could be used to assist Benedict with retirement planning.
Your model should include the following input parameters:
Benedict’s current age = 37 years
Benedict’s current total retirement savings = $259,000
Annual rate of return on retirement savings = 4 percent
Benedict’s current annual salary = $145,000
Benedict’s expected annual percentage increase in salary = 2 percent/year
Benedict’s own percentage of annual salary contributed to retirement = 6 percent
Benedict’s expected age of retirement = 65
Benedict’s expected annual expenses after retirement (current dollars) = $90,000
Rate of return on retirement savings after retirement = 3 percent
Income tax rate postretirement = 15 percent
Assume that Benedict’s employer contributes 6% of Benedict’s salary to his retirement fund in addition to the money Benedict himself puts aside. Benedict can make an additional annual contribution to his retirement fund before taxes (tax free) up to a contribution of $16,000.
Assume he contributes $6,000 per year. Also, assume an inflation rate of 2%.
Managerial Report
Your spreadsheet model should provide the accumulated savings at the onset of retirement as well as the age at which funds will be depleted (given assumptions on the input parameters).
As a feature of your spreadsheet model, build a data table to demonstrate the sensitivity of the age at which funds will be depleted to the retirement age and additional pre-tax contributions.
Similarly, consider other factors you think might be important.
Develop a report for Benedict outlining the factors that will have the greatest impact on his retirement.
|
Information for the statement of cash flows
: The management team of Wickersham Brothers Inc. is preparing its annual financial statements. Information for the Statement of Cash Flows is indicated below. Compute the changes and use the information to finalize the Statement of Cash Flows as indic..
|
|
Preparing its planning budget the company estimated
: Adger Corporation is a service company that measures its output based on the number of customers served. When preparing its planning budget the company estimated that it would serve 35 customers per month; however, during May the company actually ser..
|
|
Determine the most beneficial use of constrained resource
: What criteria should a company use when it is deciding whether to continue to make a product internally or to buy it externally? What is the best calculation to determine the most beneficial use of a Constrained Resource?
|
|
Benedict retirement planning
: Benedict is 37 years old and would like to establish a retirement plan. Develop a spreadsheet model that could be used to assist Benedict with retirement planning. Assume that Benedict’s employer contributes 6% of Benedict’s salary to his retirement ..
|
|
What is the journal entry needed to record the transaction
: On April 12, Hong Company agrees to accept a 60-day, 10%, $6,300 note from Indigo Company to extend the due date on an overdue account. What is the journal entry needed to record the transaction by Indigo Company?
|
|
What will be the balance in the retained earnings account
: The following information is available for the Noir Detective Agency, Inc. After these closing entries what will be the balance in the Retained Earnings account? Net Loss $ 27,600 Retained earnings 294,000 Dividends 36,000
|
|
Pine street should sell unfinished or finished bookcases
: Pine Street Inc. makes unfinished bookcases that it sells for $59.30. Production costs are $37.21 variable and $10.22 fixed. Because it has unused capacity, Pine Street is considering finishing the bookcases and selling them for $74.82. Prepare an an..
|
|
Calculate the company ending inventory and cost of goods
: Consider the following information for Maynor Company, which uses a perpetual inventory system: Transaction Units Unit Cost Total Cost January 1 Beginning Inventory 16 $ 66 $ 1,056 March 28 Purchase 26 72 1,872 August 22 Purchase 32 76 2,432 October ..
|