Which of the Following Statements Is (Are)true About the Federal

question 25

Multiple Choice

Which of the following statements is (are) true about the federal estate tax?
I.The gross estate can be reduced by a number of deductions.
II.If the person who died had any ownership interest in a life insurance policy at the time of death,the proceeds are included in the gross estate for federal estate tax purposes.

• A)I only
• B)II only
• C)both I and II
• D)neither I nor II

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Definitions:

Non-Monetary Items

Items that are measured at historic cost rather than their current monetary value, such as property, plant, and equipment.

Functional Currency

The currency of the primary economic environment in which an entity operates, usually the local currency or the currency of the country where it primarily generates and expends cash.

Fair Value

The proceeds from selling an asset or the financial burden of a liability transfer in a civilized negotiation with market participants on the valuation date.