The Holden Corporation maintains a SIMPLE-IRA retirement plan for its employees.The company has notified its employees that for 2017 it will fund the SIMPLE-IRA by matching an employee's contribution up to a maximum of 3% of the employee's salary.Harrison's salary in 2017 is $50,000 and he contributed $2,000 to the plan.What amount must Holden contribute on Harrison's behalf?

Question

Quizplus · Accepted Answer

Holden will match Harrison's contribution up to a maximum of 3% of his salary, which is $1,500 (3% of $50,000). Since Harrison contributed $2,000, Holden will only contribute $1,500, bringing the total contribution to $3,500. Therefore, the correct answer is C.

The Holden Corporation Maintains a SIMPLE-IRA Retirement Plan for Its