10 exam-style questions with answers and explanations. Tap an answer to check yourself. When you're ready, take the scored version in the free practice test.
These 10 free APR questions are organized by exam domain, so you can see how each part of the Accredited Pension Representative blueprint is tested. Reveal the answer and explanation under each question.
Under ERISA, what is the maximum age and length of service a qualified plan may require before an employee becomes eligible to participate (assuming the plan does NOT use the two-year-service option that mandates 100% immediate vesting)?
Correct answer: C - Age 21 with one year of service
A defined contribution plan uses a 2-to-6-year graded vesting schedule for employer contributions. A participant terminates employment with four years of vesting service. What percentage of their employer-derived account balance is vested?
Correct answer: B - 60%
In an ongoing defined contribution plan, forfeitures of non-vested employer contributions may be used for all of the following purposes EXCEPT:
Correct answer: D - Returning the amounts to the employer
For nondiscrimination testing, an employee is a highly compensated employee (HCE) under the ownership test if, at any time during the current or preceding year, the employee owned more than what percentage of the employer?
Correct answer: A - 5%
A plan benefits 63% of the employer's non-highly compensated employees and 90% of its highly compensated employees. What is the plan's ratio percentage for the IRC §410(b) minimum coverage test?
Correct answer: A - 70%
A cash balance plan expresses each participant's benefit as a hypothetical account balance credited with annual pay credits and interest credits. For qualification purposes, a cash balance plan is legally classified as:
Correct answer: C - A defined benefit plan
An employer that adopts an individually designed plan may request written IRS assurance that the FORM of the plan satisfies the qualification requirements of the Internal Revenue Code. This document is known as a:
Correct answer: D - Determination letter
Which Title of ERISA established the Pension Benefit Guaranty Corporation (PBGC) and the benefit-insurance program that protects participants when a defined benefit plan terminates without sufficient assets?
Correct answer: D - Title IV
Which document must a plan administrator automatically furnish to participants to describe, in language understandable to the average participant, their rights and benefits under the plan?
Correct answer: B - The Summary Plan Description (SPD)
In a traditional 401(k) plan, the non-highly compensated employees (NHCEs) have an average deferral percentage (ADP) of 4% for the year. Applying the ADP test limits, what is the maximum ADP permitted for the highly compensated employees (HCEs)?
Correct answer: C - 6%
The APR exam also covers these domains. Drill them in the full free practice test:
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