Apple Trust Reports Net Accounting Income of $40,000, All from Taxable

question 1

Multiple Choice

Apple Trust reports net accounting income of $40,000, all from taxable sources. The trustee is required to distribute $15,000 annually to Megan. The trustee also makes discretionary distributions of $30,000, $7,500 to Megan and $22,500 to Caroline. The trust pays $5,000 of the discretionary distributions from corpus. What is the amount of the distribution deduction?

• A)$40,000
• B)$45,000
• C)$15,000
• D)$30,000

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Definitions:

Expected Opportunity Loss

Expected opportunity loss is a decision-making tool, calculating the potential loss for not choosing the best course of action in uncertain situations.

Market Condition

The current status and dynamics of a market, including trends, demand, and competition.

Videography Business

A commercial enterprise that provides services related to filming, video editing, and production of visual content.

Expected Opportunity Loss

The anticipated loss of value from not choosing the best alternative option in a decision-making process.