Your client, Jim, age 40, earns $78,000 annually. His spouse, Pam, age 38, used to work at the office with Jim, but is now a homemaker. They have one child who just turned age 14. Jim's personal cosumption during the year was equal to $19,456 and he paid $8,550 in taxes. Assume the inflation rate is 3% and the yield on U. S. Treasury Bonds is 5%. Required:
Calculate Jim and Pam's Life insurance need using the Capitalization of Earnings Method.

Which of the following statements are false regarding activity-based costing? non-manufacturing costs are important to include when calculating the cost of each product. costs are allocated based on a pre-determined overhead rate. transitioning from traditional costing methods to activity-based costing can be complicated and costly. activity-based costing follows the same basic calculation methods as traditional costing approaches. none of the above