The Governing Instrument for the Lopez Trust Contains No Definitions

question 88

Essay

The governing instrument for the Lopez Trust contains no definitions of income and principal.The Trust is located in a state that has adopted the Uniform Act.In the current year,the trust reports the following receipts and disbursements:
$\begin{array} { l } \text { Dividends}&\$10,000\\ \text { Proceeds from sales of stock, including \( \$ 10,000 \) of gain}&\$40,000\\ \text {Trustee's fee, all charged to income }&\$500\\ \text {CPA's fee for preparation of tax return }&\$200\\\end{array}$
What is the trust's net accounting income?

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Definitions:

African-Americans

A term referring to citizens or residents of the United States who have ancestry from any of the black racial groups of Africa.

Community Property

A legal framework in some jurisdictions whereby property acquired during a marriage is owned jointly by both spouses, regardless of who earned or purchased the property.

War of 1812

A military conflict between the United States and the United Kingdom and its allies, lasting from 1812 to 1815, largely over issues of trade and maritime rights.

Treaty of Greenville

A 1795 agreement between the United States and various Native American tribes which established a boundary line and aimed to end hostilities and secure rights to settlement.