ADVANCED ACCOUNTING >CUSTOM<
14th Edition
ISBN: 9781265537012
Author: Hoyle
Publisher: MCG CUSTOM
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Chapter 19, Problem 21P
To determine
Identify the correct option out of the given statements.
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A married couple have written a will that leaves part of their money to a trust fund. The income from this trust will benefit the surviving spouse until death, with the principal then going to their children. Why was the trust fund created? Choose the correct.a. To reduce the estate of the surviving spouse and, thus, decrease the total amount of estate taxes to be paid by the couple.b. To ensure that the surviving spouse is protected from lawsuits filed by the couple’s children.c. To give the surviving spouse discretion over the ultimate use of these funds.d. To maximize the earning potential of the money because trust funds generate more income than other investments.
A married couple have written a will that leaves part of their money to a trust fund. The income from this trust will benefit the surviving spouse until death, with the principal then going to their children. Why was the trust fund created?
To reduce the estate of the surviving spouse and, thus, decrease the total amount of estate taxes to be paid by the couple.
To ensure that the surviving spouse is protected from lawsuits filed by the couple’s children.
To give the surviving spouse discretion over the ultimate use of these funds.
To maximize the earning potential of the money because trust funds generate more income than other investments.
One premortem liquidity planning technique is to reduce the client's potential gross estate. Which of the following actions may reduce the client's gross estate?
Placing assets in a grantor-retained annuity trust (GRAT) with a 10-year term that names the client's child as remainderman
Placing assets in a revocable living trust that disperses its assets to the client's child at the client's death
Placing assets in an irrevocable trust in which the client is neither a beneficiary or trustee
Placing assets in an irrevocable trust in which the client as sole trustee has discretion to distribute income
A)
I, III, and IV
B)
II, III, and IV
C)
I and III
D)
II and IV
Chapter 19 Solutions
ADVANCED ACCOUNTING >CUSTOM<
Ch. 19 - Prob. 1QCh. 19 - Prob. 2QCh. 19 - Prob. 3QCh. 19 - Prob. 4QCh. 19 - Prob. 5QCh. 19 - Prob. 6QCh. 19 - Prob. 7QCh. 19 - Prob. 8QCh. 19 - What claims against an estate have priority?Ch. 19 - Prob. 10Q
Ch. 19 - Prob. 11QCh. 19 - Prob. 12QCh. 19 - Prob. 13QCh. 19 - How is the federal estate tax computed?Ch. 19 - Prob. 15QCh. 19 - Prob. 16QCh. 19 - Prob. 17QCh. 19 - Prob. 18QCh. 19 - Prob. 19QCh. 19 - Prob. 20QCh. 19 - Prob. 21QCh. 19 - Prob. 22QCh. 19 - Prob. 23QCh. 19 - Prob. 24QCh. 19 - Prob. 25QCh. 19 - Prob. 26QCh. 19 - Prob. 27QCh. 19 - Prob. 28QCh. 19 - Prob. 29QCh. 19 - Prob. 30QCh. 19 - Prob. 1PCh. 19 - Prob. 2PCh. 19 - Prob. 3PCh. 19 - Prob. 4PCh. 19 - Prob. 5PCh. 19 - Prob. 6PCh. 19 - Prob. 7PCh. 19 - Prob. 8PCh. 19 - Prob. 9PCh. 19 - Prob. 10PCh. 19 - Which of the following is a specific legacy? a....Ch. 19 - Prob. 12PCh. 19 - Prob. 13PCh. 19 - Prob. 14PCh. 19 - Prob. 16PCh. 19 - Prob. 21PCh. 19 - Prob. 22PCh. 19 - Prob. 23PCh. 19 - Prob. 24PCh. 19 - Prob. 25PCh. 19 - Prob. 26PCh. 19 - Prob. 27PCh. 19 - Prob. 28PCh. 19 - Prob. 29PCh. 19 - Prob. 30PCh. 19 - Prob. 31PCh. 19 - Prob. 32PCh. 19 - Prob. 33PCh. 19 - Prob. 34PCh. 19 - Prob. 35P
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