Which of the following statements is not correct about the insurance premium?
A) The forecast of policyholders' losses is the starting point for the calculation of the risk premium for an insurance policy.
B) The fair rate of return, which is a part of the insurance premium, is governed by law.
C) Loading expenses increases the insurance premium.
D) Most investment income of insurance companies comes from low risk investments, which reduces the insurance premium.
B
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In 2016, the Puerto Rios Company received insurance proceeds of $300,000 payable upon the death of its previous top executive officer. For financial reporting purposes, Puerto Rios included the $300,000 in pretax accounting income. The life insurance proceeds are exempt from income taxes. Assuming an income tax rate of 35%, what should Puerto Rios report for this event as deferred income taxes in the 2016 income statement of ?
A. $0 B. $105,000 deferred tax asset C. $105,000 deferred tax liability D. $195,000 deferred tax liability
A cash payment that reduces a liability does not result in an expense
Indicate whether the statement is true or false
One advantage of utilitarianism is that there is no need for measuring the good of an action for
society. Indicate whether the statement is true or false
Fact Pattern 3-1AMac and Nan engage in a business transaction from which a dispute arises. Mac initiates a lawsuit against Nan by filing a complaint.Refer to Fact Pattern 3-1A. If Nan responds to Mac's complaint by filing a counterclaim, then
A. Mac will also have to file a response. B. Mac will have a judgment entered in his favor. C. Nan will also have to file an amended answer. D. Nan will have a judgment entered in her favor.