Company Affairs (CS) Interview Questions and Answers

 

What is deferred profit

A portion of company profits allocated by an employer, in




good years, to an employee’s trust.




Contributions on behalf of each employee are expressed as a




percentage of salary with 5% being common practice. If the




profit-sharing plan is a qualified plan according to the




IRS, employer contributions are tax deductible as a business




expense. These contributions are not currently taxable to




the employee; benefits are taxed at the time of distribution.

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