All of the Following Statements About 403(b)plans Are True EXCEPT

question 8

Multiple Choice

All of the following statements about 403(b) plans are true EXCEPT

• A)Contributions to a 403(b)reduce an employee's taxable income.
• B)403(b)plans are designed for employees of public school systems and tax-exempt organizations.
• C)The law limits the amount of income that an employee can elect to defer under a 403(b)plan.
• D)Matching employer contributions are not permitted under a 403(b)plan.

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Definitions:

Leverage Ratio

A financial ratio indicating the degree to which a company or individual is financing its operations through debt, compared to its equity.

LIFO

"Last In, First Out," an inventory management method where the most recently produced or acquired items are the first to be used or sold.

FIFO

An accounting and inventory method where the first items produced or acquired are the first ones to be sold or used, standing for "First-In, First-Out".

Current Ratio

A liquidity ratio that measures a company's ability to cover its short-term obligations with its current assets.