1.Paper Chasers, a shop that specializes in confetti has a 401(k) plan that allows plan...
60.1K
Verified Solution
Link Copied!
Question
Accounting
1.Paper Chasers, a shop that specializes in confetti has a 401(k) plan that allows plan loans up to the legal limit allowed by law. Participants must repay the loans under the most generous repayment schedule available by law. Paper Chasers plan has the following employee information:
Employee
401(k) Balance
Outstanding Loan
Sara
$200,000
$0
Kay
$250,000
$19,000
Judy
$14,000
$2,000
Brian
$35,000
$0
Which of the following statements is correct?
(a)If Kay repays her $19,000 loan by the end of this year, she may take a loan of $50,000 anytime next year.
(b)Sara can borrow $100,000 (50% of her vested account balance) from her account.
(c)The maximum Judy can borrow from her account is $8,000.
(d)Brian could borrow $17,500 from his plan for the purchase of a personal residence, but he would have to repay the loan within ten years.
I am thinking either A) because the max you can have is $50,000 at any time so if you pay off the loan, then $50k is correct. Also thinking of C; Course Hero had it 2 times as that? However, not sure because the max she can borrow is $9,000. She has $2k already out so only $7k more?
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
