Question

In: Accounting

Discussion Question: Henry is a single businessman with inadequate liquidity to cover estate administrative expenses, debts...

Discussion Question: Henry is a single businessman with inadequate liquidity to cover estate administrative expenses, debts and taxes at his death. He plans to purchase a life insurance policy which provides a tax-free investment and an immediate cash value.

Which type of policy should Henry purchase?  

Solutions

Expert Solution

Henry should purchase immediate cash value as he is having inadequate liquidity issues. Immediate cash value will be helpfull to cover the situation.

AS cash-value life insurance policies provide both a death benefit and a cash-value accumulation during the policyholder's lifetime.


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