Question: If Ronald selects the POS plan, what

> Horizon is a large, publicly traded provider of both nursing homes and management for nursing homes. It wanted to expand into Osceola County, Florida. South- ern Oaks was already operating in Osceola County; it owned the Southern Oaks Health Care Center

> Anderson and Tallstrom are partners in Rancho Murieta Investors (RMI). Anderson owns 80 percent of RMI; Tallstrom owns the other 20 percent and is the managing partner of RMI. Hellman obtained judgments against Anderson in his individual capacity for mor

> Present and former law review editors who were researching disciplinary systems and procedures at the military service academies for an article requested, but were denied, access to case summaries of honor and ethics hearings maintained in the U.S. Air F

> Michael, his mother, and his four siblings orally agreed that they would all play the lottery and that if any one of them should purchase a winning lottery ticket, all of them would share the money equally. Michael’s mother purchased the sole winning tic

> For a period of sixteen months, Great Lakes Higher Education Corp. (Great Lakes), a not-for-profit student loan servicer, issued 224 student loan checks totaling $273,152.88. The checks were drawn against Great Lakes’ account at First Wisconsin National

> Tally held a savings account with American Security Bank. On seven occasions, Tally’s personal secretary, who received his bank statements and had custody of his passbook, forged Tally’s name on withdrawal slips that she then presented to the bank. The s

> Morvarid Kashanchi and her sister, Firoyeh Paydar, held a savings account with Texas Commerce Medical Bank. An unauthorized withdrawal of $4,900 from the account was allegedly made by means of a telephone conversation between some other unidentified indi

> On Tuesday, June 11, Siniscalchi issued a $200 check on the drawee, Valley Bank. On Saturday morning, June 15, the check was cashed. This transaction, as well as others taking place on that Saturday morning, was not recorded or processed through the bank

> Laboratory Management deposited into its account at Pulaski Bank a check issued by Fairway Farms in the amount of $150,000. The date of deposit was February 5. Pulaski, the depositary bank, initiated the collection process immediately by forwarding the c

> Vincent Medina signed a check in the amount of $34,348 written on the account of First Delta Financial, a family corporation owned and controlled by Medina. His corporate title did not appear before his signature. He issued the check to James G. Wyche. T

> Attorney Eliot Disner tendered a check for $100,100 to Sidney and Lynne Cohen. In drawing the check, Disner was serving as an intermediary for his clients, Irvin and Dorothea Kipnes, who owed the money to the Cohens as part of a settlement agreement. The

> On August 10, 2019, Theta Electronic Laboratories, Inc., executed a promissory note to George and Marguerite Thomson. Three other individuals, Gerald Exten, Emil O’Neil, James Hane, and their wives also indorsed the note. The note was then transferred to

> R&A Concrete Contractors, Inc., executed a promissory note that identifies both R&A Concrete and Grover Roberts as its makers. On the reverse side of the note, the following appears: “X John Ament Sec. & Treas.” National Bank of Georgia, the payee, now s

> The Public Company Accounting Oversight Board (PCAOB) was created as part of a series of accounting reforms in the Sarbanes-Oxley Act of 2002. The PCAOB is a governmentally created entity with expansive powers to regulate the entire accounting industry.

> In 1942, Congress passed the Emergency Price Control Act in the interest of national defense and security. The stated purpose of the Act was “to stabilize prices and to prevent speculative, unwarranted and abnormal increases in prices and rents.” The Act

> What amount would a person with actual cash value (ACV) coverage receive for two-year-old furniture destroyed by a fire? The furniture would cost $2,000 to replace today and had an estimated life of five years. (LO8.2)

> Most home insurance policies cover jewelry for $2,000 and silverware for $5,000 unless items are covered with additional insurance. If $9,000 worth of jewelry and $12,000 worth of silverware were stolen from a family, what amount of the claim would not b

> What was the gift tax in 2019?

> You have $100,000 in your retirement fund that is earning 5.5 percent per year, compounded quarterly. How many dollars in withdrawals per month would reduce this nest egg to zero in 20 years? How many dollars per month can you withdraw for as long as y

> Gene and Dixie, husband and wife (ages 35 and 32), both work. They have an adjusted gross income of $95,000 in 2020, and they are filing a joint income tax return. Both have an employer-provided retirement plan at work. What is the maximum IRA contrib

> Ruby is 25 and has a good job at a biotechnology company. She currently has $10,000 in an IRA, an important part of her retirement nest egg. She believes her IRA will grow at an annual rate of 8 percent, and she plans to leave it untouched until she reti

> Using Exhibit 14-3, calculate approximately how much money the older (age 65-74) household from Problem 4 spends on medical care. (LO 14.1)

> Calculate approximately how much money an older (age 65-74) household with an annual income of $45,000 spends on housing each year. (Hint: Use Exhibit 14-3) (LO 14.1)

> Ted Riley owns a Lexus worth $40,000. He owns a home worth $275,000. He has a checking account with $800 in it and a savings account with $1,900 in it. He has a mutual fund worth $110,000. His personal assets are worth $90,000. He still owes $25,000 on h

> Prepare your net worth statement using the assets - liabilities = net worth equation. (LO 14.1)

> Currently, the economy is beginning to slowdown and there is talk that there may be a recession in the near future. Referring to Exhibit 12-3, what types of stock would you suggest for Jamie and Ross to invest in considering their life stage and current

> Joe and Rachel are both retired. Married for 55 years, they have amassed an estate worth $4.4 million. The couple has no trust or other type of tax-sheltered assets. If Joe or Rachel died in 2020, how much federal estate tax would the surviving spouse

> What is the total of estate removed from Barry and Mary's estate in 2020?

> How much money can Barry and Mary gift to their grandchildren in 2020 without any gift tax liability?

> How much money can they gift to their children in 2020 without any gift tax liability?

> In 2020, you gave a $15,000 gift to a friend. What was the gift tax in 2020? (LO 14.4)

> What will be the gift tax in 2020?

> What is the total amount removed from Joshua’s estate in 2020?

> Shelly's assets include money in checking and saving accounts, investments in stocks and mutual funds, personal property, such as furniture, appliances, an automobile, coin collection and jewelry. Shelly calculates that her total assets are $165,200. H

> Using the "nonworking" spouse method, what should be the life insurance needs for a family whose youngest child is 5 years old? (LO10.1)

> Using the "nonworking" spouse method, what should be the life insurance needs for a family whose youngest child is ten years old? (LO10.1)

> Jamie Lee’s father suggested that they purchase stock in a company that he has held shares in for decades. They want to take advantage of the stock tip, but Jamie Lee and Ross are trying to decide between purchasing the company’s common stock and prefer

> You are a dual income, no-kids family. You and your spouse have the following debts (total): mortgage, $200,000; auto loan, $10,000; credit card balance, $4,000; and other debts of $10,000. Further, you estimate that your funeral will cost $8,000. You

> Mark and Parveen are the parents of three young children. Mark is a store manager in a local supermarket. His gross salary is $75,000 per year. Parveen is a full time stay-at-home mom. Use the easy method to estimate the family's life insurance needs

> Use Exhibit 10-1 to find the average number of additional years a 25-year-old male and female are expected to live, based on the statistics gathered by the U.S. government as of 2017 (LO10.1)

> Use the Figure It Out worksheet in this chapter to calculate your own life insurance needs. (LO10.1)

> Shaan and Anita are married and have two children, ages 4 and 7. Anita is a “nonworking” spouse who devotes all of her time to household activities. Estimate how much life insurance Shaan and Anita should carry. (LO10.1)

> You and your spouse are in good health and have reasonably secure careers. Each of you makes about $55,000 annually. You own a condominium with an $120,000 mortgage, and you owe $15,000 on car loans, $5,000 on personal debts, and $4,000 on credit card

> Shelly’s variable annuity has a mortality and expense risk charge at an annual rate of 1.25 percent of account value. Her account value during the year is $50,000. What was Shelly’s mortality and expense risk charge for the year? (LO10.4)

> Sophia purchased a variable annuity contract with a $25,000 purchase payment. Surrender charges begin with 7 percent in the first year, and decline by 1 percent each year. In addition, Sophia can withdraw 10 percent of her contract value each year with

> Your variable annuity charges administrative fees at an annual rate of 0.15 percent of account value. Your average account value during the year is $200,000. What is the administrative fee for the year? (LO10.4)

> You are the wage earner in a “typical family,” with $58,000 gross annual income. Use the easy method to determine how much insurance you should carry. (LO10.1)

> What are the advantages and disadvantages of investing in a technology company’s IPO? Will they be guaranteed a large return from this investment? At this life stage would you recommend that Jamie Lee and Ross invest in an IPO? Why or why not?

> In 2007, Joelle spent $5,000 on her health care. If this amount increased by 6 percent per year, what would be the amount Joelle spent in 2017 for the same health care? (Hint: Use the Time Value of Money Table in Chapter 1 Appendix, Exhibit 1-A) (LO9.

> What total costs will Ronald pay if he enrolls in the HMO plan? (LO9.2)

> What annual medical costs will Ronald pay using the sample medical expenses provided if he enrolled in the Blue Cross/Blue Shield plan? (LO9.2)

> Stephanie was injured in a car accident and rushed to the emergency room. She received stitches for a facial wound and treatment for a broken finger. Under Stephanie’s PPO plan, emergency room care at a network hospital is 80 percent covered after the

> Georgia, a widow, has a take-home pay of $1,200 a week. Her disability insurance coverage replaces 70 percent of her earnings after a four-week waiting period. What amount would she receive in disability benefits if an illness kept Georgia off work for

> Becky’s comprehensive major medical health insurance plan at work has a deductible of $750. The policy pays 85 percent of any amount above the deductible. While on a hiking trip, she contracted a rare bacterial disease. Her medical costs for treatment, i

> A health insurance policy pays 65 percent of physical therapy cost after a $200 deductible. In contrast, an HMO charges $15 per visit for physical therapy. How much would a person save with the HMO if he or she had 10 physical therapy sessions costing $5

> In 2012, per capita spending on health care in the United States was about $9,000. If this amount increased by 7 percent a year, what would be the amount of per capita spending for health care in 8 years? (Hint: Use the Time Value of Money Table in th

> The Tucker family has health insurance coverage that pays 80 percent of out-of-hospital expenses after a $1,000 deductible per person. If one family member has doctor and prescription medication expenses of $2,200, what amount would the insurance pay? (L

> Jamie Lee and Ross agree that by accomplishing their short goals, they can budget $7,000 a year towards their long-term investment goals. They are estimating that with the allocations recommended by their financial advisor, they will see an average of 7

> Shaan and Anita currently insure their cars with separate companies, paying $650 and $575 a year. If they insure both cars with the same company, they would save 10 percent on the annual premiums. What would be the future value of the annual savings o

> In the preceding example, assuming their insurance rates remain the same, how many years will it take Dave and Ellen to earn back in discounts the cost of the deadbolts? (LO8.2)

> Dave and Ellen are newly married and living in their first house. The yearly premium on their homeowner’s insurance policy is $450 for the coverage they need. Their insurance company offers a 5% discount if they install deadbolt locks on all exterior doo

> When Carolina's house burned down, she lost household items worth a total of $50,000. Her house was insured for $160,000 and her homeowners' policy provided coverage for personal belongings up to 55 percent of the insured value of the house. Calculate h

> Karen and Mike currently insure their cars with separate companies paying $700 and $900 a year. If they insure both cars with the same company, they would save 10 percent on the annual premiums. What would be the future value of the annual savings over t

> Kurt Simmons has 50/100/15 auto insurance coverage. One evening he lost control of his vehicle hitting a parked car and damaging a store front along the street. Damage to the parked car was $5,400 and damage to the store was $12,650. What amount will the

> Becky Fenton has 25/50/10 automobile insurance coverage. If two other people are awarded $35,000 each for injuries in an auto accident in which Becky was judged at fault, how much of this judgment would insurance cover? (LO8.4)

> Assume you are in the 35 percent tax bracket and purchase a 3.20 percent municipal bond. Use the formula presented in this chapter to calculate the taxable equivalent yield for this investment. (LO11.4)

> Assume you are in the 24 percent tax bracket and purchase a 2.90 percent municipal bond. Use the formula presented in this chapter to calculate the taxable equivalent yield for this investment. (LO11.4)

> Use the information in the Figure It Out! box earlier in this chapter to complete the following table.

> Jamie Lee and Ross need to evaluate their emergency fund of $21,000. Will their present emergency fund be sufficient to cover them should one of them lose their job?

> Jane and Bill Collins have total take-home pay of $5,400 a month. Their monthly expenses total $4,250. Calculate the minimum amount this couple needs to establish an emergency fund. (LO11.1)

> Bob Orleans invested $3,000 and borrowed $3,000 to purchase shares in Verizon Communications. At the time of his investment, Verizon was selling for $60 a share. (LO12.5) a. If Bob paid a commission of $20, how many shares could he buy if he used only

> For four years, Marty Campbell invested $4,000 each year in Harley-Davidson. The stock was selling for $55 in 2017, $47 in 2018, $36 in 2019, and $33 in 2020. (LO12.5) a. What is Marty’s total investment in Harley-Davidson? b. After four years, how man

> Assume you own a corporate bond that has a face value of $1,000 and pays 4.60 percent. What is the current yield if the bond is currently selling for $1,080? (LO11.6)

> Determine the current yield on a corporate bond investment that has a face value of $1,000, pays 4.45 percent, and has a current price of $920. (LO11.6)

> In 2009, you purchased a $1,000 corporate bond with a coupon interest rate of 4%. Today, comparable bonds are paying 3.30 percent. (LO11.5) a. What is the approximate dollar price for which you could sell your bond? b. In your own words, describe why y

> Five years ago, you purchased a $1,000 par value corporate bond with a coupon interest rate of 3.6 percent. Today comparable bonds are paying 4.2 percent. (LO11.5) a. What is the approximate dollar price for which you could sell your bond? b. In your own

> Assume that you purchased a $1,000 convertible corporate bond. Also assume the bond can be converted to 18.5 shares of the firm’s stock. What is the dollar value that the stock must reach before investors would consider converting to common stock? (LO11.

> Five years ago, you purchased seven corporate bonds that pays 3.84 percent. The purchase price was $1,000. How much interest do you earn on the seven bonds each year? (LO11.5)

> Three years ago, you purchased a corporate bond that pays 4.30 percent. The purchase price was $1,000. What is the annual dollar amount of interest that you receive from your bond investment? (LO11.5)

> Using the formula to determine the percentage of growth investments discussed in this chapter, determine how much of Jamie Lee and Ross’s investments should be growth investments? How should the remaining investments be distributed, and what is the assoc

> The Yamaha Aggressive Growth fund has a 1.83 percent expense ratio. (LO13.1) a. If you invest $64,000 in this fund, what is the dollar amount of fees that you would pay this year? b. Based on the information in this chapter and your own research, is thi

> When Jill Thompson received a large settlement from an automobile accident, she chose to invest $140,000 in the Vanguard 500 Index Fund. This fund has an expense ratio of 0.14 percent. What is the amount of the fees that Jill will pay this year? (LO13

> As part of his 401(k) retirement plan at work, Ken Lowery invests 5 percent of his salary each month in the Capital Investments Lifecycle Fund. At the end of this year, Ken’s 401(k) account has a dollar value of $330,700. If the fund charges a 12b-1 fe

> Betty and James Holloway invested $71,000 in the Financial Vision Social Responsibility Fund. The management fee for this fund is 0.80 percent of the total asset value. Calculate the management fee the Holloways must pay. (LO13.1)

> The value of Mike Jackson’s shares in the New Frontiers Technology fund is $63,200. The management fee for this particular fund is 0.60 percent of the total asset value. Calculate the management fee Mike must pay this year. (LO13.1)

> Mary Canfield purchased shares in the New Dimensions Global Growth Fund. This fund doesn’t charge a front-end load, but it does charge a contingent deferred sales load of 4 percent for any withdrawals during the first year. If Mary withdraws $6,000 dur

> As Bart Brownlee approached retirement, he decided the time had come to invest some of his nest egg in a conservative fund. He chose the Franklin Utilities Fund. If he invests $25,000 and the fund charges a 3.75 percent load when shares are purchased,

> Jan Throng invested $61,000 in the Invesco Charter mutual fund. The fund charges a 5.50 percent commission when shares are purchased. Calculate the amount of commission Jan must pay. (LO13.1)

> During one three-month period, Matt Roundtop’s mutual fund grew by $4,000. If he withdraws 35 percent of the growth, how much will he receive? (LO13.4)

> Over a four-year period, LaKeisha Thompson purchased shares in the Oakmark Investor Class Fund. Using the information below, answer the questions that follow. You may want to review the concept of dollar cost averaging in Chapter 12 before completing thi

> Using the investment goal guidelines, assess the validity of Jamie Lee and Ross’s short- and long-term financial goals and objectives (college education for the kids; retirement; and a second home).

> Assume that one year ago, you bought 120 shares of a mutual fund for $31 a share, you received a $0.82 per-share capital gain distribution during the past 12 months, and the market value of the fund is now $36 a share. (LO13.4) A. Calculate the total re

> Three years ago, James Matheson bought 200 shares of a mutual fund for $29 a share. During the three-year period, he received total income dividends of $1.90 per share. He also received total capital gain distributions of $2.80 per share during the thr

> Jason Mathews purchased 300 shares of the Hodge & Mattox Energy Fund. Each share cost $15.15. Fifteen months later, he decided to sell his shares when the share value reached $18.10. (LO13.4) a. What was the amount of his total investment? b. What was

> The Western Capital Growth mutual fund has Total assets: $836,000,000 Total liabilities: $6,000,000 Total number of shares: 40,000,000 What is the fund’s net asset value (NAV)? (LO13.1)

> Currently, 3M Company pays an annual dividend of $5.88. If the stock is selling for $160, what is the dividend yield? (LO12.3)

> Analysts that follow JPMorgan Chase, one of the nation’s largest providers of financial services, estimate that the corporation’s earnings per share will increase from $10.87 in the current year to $11.55 next year. (LO12.3) a. What is the amount of the

> Michelle Townsend owns stock in National Computers. Based on information in its annual report, National Computers reported after-tax earnings of $9,700,000 and has issued 7,000,000 shares of common stock. The stock is currently selling for $32 a share.

> In September, the board of directors of Chaparral Steel approved a 2-for-1 stock split. After the split, how many shares of Chaparral Steel stock will an investor have if he or she owned 230 shares before the split? (LO12.1)

> Wanda Sotheby purchased 120 shares of Home Depot stock at $235 a share. One year later, she sold the stock for $218 a share. She paid her broker a $34 commission when she purchased the stock and a $39 commission when she sold it. During the 12 months