SEGREGATED FUNDS & ANNUITIES (ADVOCIS MATERIAL) EXAM QUESTIONS WITH CORRECT
ANSWERS |LATEST UPDATE 100% SOLVED| GRADED A+
Money market funds ______must invest at least 95 percent of their total net assets in cash
or cash equivalents, such as Government of Canada short-term bonds or treasury
bills.______are the lowest risk funds and, correspondingly, have a low rate of return.
Post retirement benefit The______is a supplementary pension available to contributors. It is
paid for life and added to the CPP benefit. It is mandatory to make contributions to the
______between ages 60 and 65 if work continues. At age 65 contributions become voluntary.
Balanced funds ______suit an investor who wants some exposure to the stocks but is not
prepared for the volatility of stocks alone.
Guaranteed income supplement The ______and the allowance are monthly benefits paid to
OAS recipients with a low income. These benefits are not taxable. A province may also offer a
supplementary pension to its low income retired residents.
Income funds ______are not restricted to bonds and some may also hold high quality
stocks. When stocks are included in the income fund portfolio, the unit owner maz receive both
dividends and capital gains from his investment.
Vesting ______is a feature of RPPs. It benefits the employees by putting ownership of both
employee and employer contributions to the RPP, plus investment returns, into the hands of
the employee at the time the employee leaves the employer. When______is not immediate,
the employee retains his contributions when he leaves his employer but is not entitled to
receive his employers contributions.
Joint annuity An income for a spouse can be created by a single life annuity in which the
spouse is named as annuitant ;______in which both spouses may receive annuity income and at
death if one, the surviving spouse continues to receive the annuity payment.
,Defined benefit pension plan The ______is considered the gold standard of retirement
pensions. It pays an income on retirement that is known in advance, lasts for life, has a
provision for the spouse when the employee dies, and is often indexed to increases in the cost
of living.
Accrual When an annuity is deferred later than December 31 of the year following the
purchase date, it is taxed on an ______basis. ______income is taxed annually.
Underfunded Benefits can be jeopardized for members of DBPPs if the sponsor fails to make
its necessary contributions to the plan. In this case the pension is said to be ______.
Instalment refund annuity An annuity is called a "cash refund annuity" if the beneficiary
receives a lump sum. If the amount is paid in instalments, the annuity is called an ______.
Defined contribution pension plan A______ is also called a money purchase plan. The
amount paid as the retirement income for a ______member is entirely based on contributions
and investment income that accumulate in the plan. The employer makes no commitments to
the amount of pension that will be received. Therefore, the plan member does not know the
income to expect during retirement.
Defined contribution pension plan A member of a ______decides how to invest
contributions. She will be provided with a menu of investment choices and a default investment
option.
Deferred profit sharing plan A ______is offered by companies to share their business profits
with employees who are plan members.
Over contributions ______have been known to occur when a withdrawal and deposit are
made in a single year. ______are penalized. There is a charge of 1 percent per month on an
excess contribution until a withdrawal of the excess is made. If an______is deemed deliberate,
any investment gains on the excess are taxed at a rate of 100 percent.
, Individual registered savings plans ______are personal investment accounts that are
registered with the CRA by the institution that holds the plan's account. Registration with the
CRA enables the plan owner to receive tax benefits that are not available in non-registered
accounts.
Defined contribution pension plan The retirement pension from a ______is a result of the
amount of contributions, the length of time contributions are made and investment
performance. There are no guarantees as to how much will be received as a pension.
Registered retirement saving plan The contribution made to the ______can be deducted
from federal and provincial income tax and may move the taxpayer to a lower tax bracket, thus
lowering her marginal tax rate ;the investment income earned in the account is not taxed until
its withdrawn.
Registered disability savings plan Investment income earned in this plan accumulates tax-
free. However, grants, bonds and investment income earned in the plan are included in the
beneficiary's income for tax purposes when paid out of the ______.
Adjusted cost base Taxable allocations of the returns generated by the fund will be declared
and will increase the ______when the account is not registered.
Fund facts ______are part of the information folder and are delivered to a prospective
investor before the application for the contract is signed. Providing ______is mandatory as part
of the disclosure process that accompanies a sale.
Accumulation annuity An ______contract requires its owner to make choices that center on
its role as an investment and the term for investment.
Administrator The ________is responsible for overall administration of the pension plan
including :management of the pension plan, establishing a written statement of investment
policy, investing the fund assets in accordance with that policy, creating and distributing other
plan documents, and acting in accordance with applicable legislation.
ANSWERS |LATEST UPDATE 100% SOLVED| GRADED A+
Money market funds ______must invest at least 95 percent of their total net assets in cash
or cash equivalents, such as Government of Canada short-term bonds or treasury
bills.______are the lowest risk funds and, correspondingly, have a low rate of return.
Post retirement benefit The______is a supplementary pension available to contributors. It is
paid for life and added to the CPP benefit. It is mandatory to make contributions to the
______between ages 60 and 65 if work continues. At age 65 contributions become voluntary.
Balanced funds ______suit an investor who wants some exposure to the stocks but is not
prepared for the volatility of stocks alone.
Guaranteed income supplement The ______and the allowance are monthly benefits paid to
OAS recipients with a low income. These benefits are not taxable. A province may also offer a
supplementary pension to its low income retired residents.
Income funds ______are not restricted to bonds and some may also hold high quality
stocks. When stocks are included in the income fund portfolio, the unit owner maz receive both
dividends and capital gains from his investment.
Vesting ______is a feature of RPPs. It benefits the employees by putting ownership of both
employee and employer contributions to the RPP, plus investment returns, into the hands of
the employee at the time the employee leaves the employer. When______is not immediate,
the employee retains his contributions when he leaves his employer but is not entitled to
receive his employers contributions.
Joint annuity An income for a spouse can be created by a single life annuity in which the
spouse is named as annuitant ;______in which both spouses may receive annuity income and at
death if one, the surviving spouse continues to receive the annuity payment.
,Defined benefit pension plan The ______is considered the gold standard of retirement
pensions. It pays an income on retirement that is known in advance, lasts for life, has a
provision for the spouse when the employee dies, and is often indexed to increases in the cost
of living.
Accrual When an annuity is deferred later than December 31 of the year following the
purchase date, it is taxed on an ______basis. ______income is taxed annually.
Underfunded Benefits can be jeopardized for members of DBPPs if the sponsor fails to make
its necessary contributions to the plan. In this case the pension is said to be ______.
Instalment refund annuity An annuity is called a "cash refund annuity" if the beneficiary
receives a lump sum. If the amount is paid in instalments, the annuity is called an ______.
Defined contribution pension plan A______ is also called a money purchase plan. The
amount paid as the retirement income for a ______member is entirely based on contributions
and investment income that accumulate in the plan. The employer makes no commitments to
the amount of pension that will be received. Therefore, the plan member does not know the
income to expect during retirement.
Defined contribution pension plan A member of a ______decides how to invest
contributions. She will be provided with a menu of investment choices and a default investment
option.
Deferred profit sharing plan A ______is offered by companies to share their business profits
with employees who are plan members.
Over contributions ______have been known to occur when a withdrawal and deposit are
made in a single year. ______are penalized. There is a charge of 1 percent per month on an
excess contribution until a withdrawal of the excess is made. If an______is deemed deliberate,
any investment gains on the excess are taxed at a rate of 100 percent.
, Individual registered savings plans ______are personal investment accounts that are
registered with the CRA by the institution that holds the plan's account. Registration with the
CRA enables the plan owner to receive tax benefits that are not available in non-registered
accounts.
Defined contribution pension plan The retirement pension from a ______is a result of the
amount of contributions, the length of time contributions are made and investment
performance. There are no guarantees as to how much will be received as a pension.
Registered retirement saving plan The contribution made to the ______can be deducted
from federal and provincial income tax and may move the taxpayer to a lower tax bracket, thus
lowering her marginal tax rate ;the investment income earned in the account is not taxed until
its withdrawn.
Registered disability savings plan Investment income earned in this plan accumulates tax-
free. However, grants, bonds and investment income earned in the plan are included in the
beneficiary's income for tax purposes when paid out of the ______.
Adjusted cost base Taxable allocations of the returns generated by the fund will be declared
and will increase the ______when the account is not registered.
Fund facts ______are part of the information folder and are delivered to a prospective
investor before the application for the contract is signed. Providing ______is mandatory as part
of the disclosure process that accompanies a sale.
Accumulation annuity An ______contract requires its owner to make choices that center on
its role as an investment and the term for investment.
Administrator The ________is responsible for overall administration of the pension plan
including :management of the pension plan, establishing a written statement of investment
policy, investing the fund assets in accordance with that policy, creating and distributing other
plan documents, and acting in accordance with applicable legislation.
