Isabel, Age 51 and Single, Is an Electrical Engineer Employed

question 128

Essay

Isabel, age 51 and single, is an electrical engineer employed by Regis Corporation. Isabel's annual salary is $80,000. Regis Corporation's qualified pension plan matches employee's contributions to the plan up to 5% of the employee's annual salary. During the current year, Isabel contributes the $4,000 maximum to the plan, which is matched by Regis. Due to high cost of medical insurance, the corporation does not provide any medical insurance to its employees. Instead, it offers a flexible benefits plan that employees can use to pay for medical insurance, unreimbursed medical costs, and childcare costs. Isabel elects to have $2,500 paid into the plan. Isabel uses the plan to purchase medical insurance costing $2,200. Isabel spends an additional $150 from the plan on eyeglasses and dental costs. Regis Corporation also provides group-term life insurance at twice the employee's annual gross salary. The cost of Isabel's insurance was $600. Regis also provides engineers in Isabel's department with free parking in the company's parking garage. Non-employees pay $3,060 per year to park in the garage. Isabel's $250 dues to the Electrical Engineer's Association and her $1,560 health club membership are also paid by Regis. Compute Isabel's taxable compensation from Regis Corporation.

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Definitions:

Financial Position Form

A statement or report detailing a company's financial standing at a particular point in time, including its assets, liabilities, and equity.

Balance Sheet

A financial statement that summarizes a company's assets, liabilities, and shareholders' equity at a specific point in time, demonstrating its financial position.

Descriptive Statement

A statement providing detailed information or explanations about a subject to convey understanding or clarify meaning.

Financial Statements

Consolidated reports created from a company's accounting data, including the balance sheet, income statement, and cash flow statement, used to communicate the financial performance and condition of the company.