Question 1
Under a qualified pension plan, the employer's deduction is usually deferred until the employee recognizes income.
◦ true
◦ false
Question 2
Avantra Inc. is a professional firm with the professional employee group generally in the top tax bracket and the support staff generally in the 15% tax bracket. Due to rising costs and administrative burden, the company is considering discontinuing its dental and eye care insurance plan and instead giving all employees a $600 raise. Based on insurance records the average employee incurs about $400 of dental and eye care expense per year. Which of the following statements is correct?
◦ The support staff will generally prefer the raise, and the professional staff will prefer to keep the insurance coverage.
◦ The professional staff will generally prefer the raise, and the support staff will prefer to keep the insurance coverage.
◦ Employees overall will generally prefer the raise.
◦ Employees overall will generally prefer to retain the insurance coverage.
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