Which of the Following Statements Comparing Qualified Defined Contribution Plans

question 40

Multiple Choice

Which of the following statements comparing qualified defined contribution plans and nonqualified deferred compensation plans is false?

• A)Employers must fund qualified defined contribution plans but not nonqualified deferred compensation plans.
• B)Qualified defined contribution plans are subject to formal vesting requirements while nonqualified deferred compensation plans are not.
• C)Distributions from both types of plans are taxed at ordinary income tax rates.
• D)In terms of tax consequences to the employee, earnings on qualified plans (except Roth plans) are deferred until distributed to the employee but earnings on nonqualified plans are immediately taxablE.Employees are not taxed on nonqualified deferred compensation plans until they receive distributions from the plans.

Prepare and analyze classified and unclassified balance sheets.

Understand and perform journal entries for transactions in governmental and enterprise funds.

Distinguish between types of fund financial statements and government-wide financial statements.

Understand the purpose and components of government-wide financial statements.

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Definitions:

Operating System Program

An operating system (OS) manages computer hardware and software resources and provides common services for computer programs.

Application Program

A computer software designed to help the user perform singular or multiple related specific tasks.

Technology

The application of scientific knowledge for practical purposes, especially in industry and the creation of devices, systems, or methods.

Using An App

The process of interacting with a software application on a computer, smartphone, or other electronic devices, to perform specific tasks or access services.