In Order for a Plan to Be a "Qualified" Retirement

question 4

Multiple Choice

In order for a plan to be a "qualified" retirement plan,it must meet all of the following requirements except:

• A)The plan must be created for the exclusive benefit of the employees or their beneficiaries.
• B)The contributions and benefit can discriminate in favor of the highly compensated employees.
• C)The plan must meet certain participation and coverage requirements.
• D)There is a minimum vesting requirement which must be met with respect to employee and employer contributions.

---

Definitions:

Investing Activities

Transactions related to the acquisition or sale of long-term assets and investments not included in cash equivalents.

Financing Activities

Activities that result in changes in the size and composition of the equity and borrowings of a company.

Inventory Account

An account on the balance sheet that reports the value of a company's goods that are unsold at the end of the accounting period.

Indirect Method

A method used in cash flow statements to convert net income into net cash flow from operating activities, by adjusting for non-cash transactions.