Yellow Trust Must Distribute 33% of Its Income Annually to Patrick

question 99

Multiple Choice

Yellow Trust must distribute 33% of its income annually to Patrick. In addition, the trustee in its discretion may distribute additional income to Minna or Patrick. In the current year, the trust has net accounting income and distributable net income of $150,000, none from tax-exempt sources. The trust makes a $50,000 mandatory distribution to Patrick and a discretionary distribution of $20,000 each to Patrick and Minna. What amounts of income do Patrick and Minna report?

• A) \[\begin{array} { | l | l | }
• \hline \text { Patrick } & \text { Minna } \\
• \hline \$ 50,000 & \$ 0 \\
• \hline
• \end{array}\]
• B) \[\begin{array} { | l | l | }
• \hline \text { Patrick } & \text { Minna } \\
• \hline \$ 70,000 & \$ 20,000 \\
• \hline
• \end{array}\]
• C) \[\begin{array} { | l | l | }
• \hline \text { Patrick } & \text { Minna } \\
• \hline \$ 170,000 & \$ 0 \\
• \hline
• \end{array}\]
• D) \[\begin{array} { | l | l | }
• \hline \text { Patrick } & \text { Minna } \\
• \hline \$ 150,000 & \$ 20,000 \\
• \hline
• \end{array}\]

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Definitions:

Hormone

Biological chemicals released by glands that regulate bodily functions and behavior by acting on specific target organs.

Appetite-Suppressing

Related to or having the ability to reduce the desire to eat, often used in the context of diet and weight loss.

Hypothalamus

A region of the brain below the thalamus, responsible for regulating many vital bodily functions including hunger, thirst, temperature, and emotional responses.

Basal Metabolic Rate

The rate at which the body uses energy while at rest to maintain vital functions such as breathing and keeping warm.