In General, Which of the Following Statements Regarding Self-Employed Retirement

question 72

Multiple Choice

In general, which of the following statements regarding self-employed retirement accounts is True?

• A) In general, SEP IRAs have higher contribution limits than individual 401(k)s if the contributing taxpayer is at least 50 years of age at year end.
• B) In general, SEP IRAs have higher contribution limits than individual 401(k)s no matter the age of the contributing taxpayer.
• C) In general, Individual 401(k)s have higher contribution limits than SEP IRAs.
• D) None of the choices are True. In general, both SEP IRAs and individual 401(k)s have exactly the same annual contribution limits.

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Definitions:

Gain On Sale

The profit realized from the sale of an asset when the selling price exceeds its book value.

Indirect Method

A method for creating the cash flow statement that involves modifying net income based on balance sheet account variations to compute the operating activities' cash flow.

Accounts Receivable

Money owed to a company by its customers for products or services that have been delivered but not yet paid for.

Accrued Liabilities

Expenses that have been incurred but not yet paid, recognized on the balance sheet for financial reporting purposes.