Ross Works for Houston Corporation,which Has a Contributory Defined Contribution

question 140

Multiple Choice

Ross works for Houston Corporation,which has a contributory defined contribution pension plan.The employer's monthly contribution to the plan is 8 percent of each participating employee's monthly salary,while the employee contributes only 6 percent.Ross's monthly salary is $3,000.Which of the following statements best describes the benefits of the plan?

• A)Houston receives a deduction for its contributions to the plan when Ross receives a distribution from the plan.
• B)While Ross is taxed on the employer's contributions to the plan,his own contributions are not taxed until he receives a distribution from the plan.
• C)Ross may deduct his own contributions to the pension plan,and Ross reports income from the plan each year until he receives distributions from the plan.
• D)The amounts contributed to the plan and the earnings on those contributions are not taxed to Ross until he retires or receives a distribution from the plan.

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Definitions:

Stimulus Generalization

A process in learning theory where a response to a specific stimulus becomes associated with similar stimuli.

Negative Reinforcement

A behavioral psychology concept where the removal of an unfavorable outcome or stimulus strengthens the behavior that led to its removal.

Biological Constraints

The concept that there are limits on what can be learned or how learning processes can unfold, based on an organism's biology.

Instinctive Drift

The tendency for an animal's learned behavior to revert to its instinctual behaviors over time.