Jonathan and Lisa Are Planning to Retire in Two Years

question 31

Multiple Choice

Jonathan and Lisa are planning to retire in two years. They will receive pensions, social security, and they have adequate savings. They have satisfying careers and work 60 hours a week. They live on acreage outside of town and have few social contacts. They are looking forward to having a relaxing breakfast together each morning and doing what they please. Hypothesize how they will fare in retirement.

• A) Jonathan will be more satisfied in retirement because they have plenty of financial assets.
• B) Lisa will be more satisfied because they have plenty of financial assets.
• C) Jonathan will be satisfied in retirement because men tend to fare better in retirement.
• D) Lisa will be satisfied in retirement because men tend to fare better in retirement.

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Definitions:

Royalty Income

Income derived from the use of an individual’s or entity's property, such as patents, copyrighted works, or natural resources.

Informational Returns

Tax documents used to report certain types of transactions to the IRS, including income, interest, dividends, but not directly tax-deductible amounts.

Straight-Line Method

A method of calculating depreciation for accounting purposes, allocating a uniform expense amount to each year of an asset's useful life.

Depreciated

A decrease in the value of an asset over time, often due to wear and tear or obsolescence, which can be used for tax deductions.