Homework Clinic
Social Science Clinic => Accounting => Topic started by: nautica902 on Sep 13, 2020
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Judy is considering receiving either $20,000 of current salary or $40,000 of deferred compensation in 12 years. Her current tax rate is 33%, but she expects her tax rate to be 15% 12 years from now. Judy can invest any after-tax current salary at a 6% ATROR. If she receives the deferred compensation, her investment will accumulate to
◦ $26,800.
◦ $34,000.
◦ $36,000.
◦ $40,000.
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$34,000.