Friday Five – 20 January – 5 Questions in 5 Minutes
Last updated on September 25th, 2019 at 4:33 am
Welcome to this week’s Friday Five – 5 Questions in 5 Minutes Every Friday
What’s this all about?
It’s a bit of Friday Fun where we provide you with 5 questions relevant to a mix of CII exams. The challenge is for you to answer them in 5 minutes. Answers at the bottom of the page.
These questions relate to examinable tax year 2016/17, examinable until 31 August 2017.
- How do you calculate a client’s net worth?
- Deduct the client’s total liabilities from their total assets
- Value of house less mortgage
- Total expenditure deducted from total income
- Value of non-essential expenditure
- Dan runs a hedge fund and relies on arbitrage to produce his returns. This suggests that he is using which of the following strategies?
- Event driven
- Relative value
- Tactical trading
- Lisa has recently made a £100,000 gain on selling her buy to let home. She is now considering whether to reinvest this in an Enterprise Investment Scheme (EIS). Which of the following would be a benefit to Lisa of doing this?
- She can defer the original gain until she disposes of the EIS shares
- 50% of the original gain will be exempt from tax
- Any subsequent gain would be taxed at a lower rate on disposal
- This will reduce the base cost of the EIS shares by the original gain
- John has a defined contribution AVC whereas Tom’s AVC is on an “added years” basis. In which area will Tom’s arrangement differ from John’s?
- Tax relief on contributions.
- Some of the benefit can be in the form of tax free cash.
- Minimum pension age.
- Inability to draw the benefit independent of the main scheme.
- How is the cover provided under a whole of life policy affected if premiums cease at a stated age?
- It remains in force for a maximum period of 10 years
- It reduces to 50% when premiums cease
- It reduces by a stated percentage in each future year
- It is not affected – the cover continues until death
- A – See R01 Study Text, Chp 8
Grab our taster mock exam paper for CII R01. Click here to download.
- B – See R02 Study Text, Chp 6:2
Grab our taster mock exam paper for CII R02. Click here to download.
- A – See R03 Study Text, Chp 3
Grab our taster mock exam paper for CII R03. Click here to download.
- D – See R04 Study Text, Chp 4
Grab our taster mock exam paper for CII R04. Click here to download.
- D – See R05 Study Text, Chp 4
Grab our taster mock exam paper for CII R05. Click here to download.
How did you find this week’s questions? Did you complete them in 5 minutes? Did you get them all correct? Do you disagree with any?
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