A Trust Has Net Accounting Income of $15,000

question 88

Multiple Choice

A trust has net accounting income of $15,000. In addition, the trust has a $10,000 capital gain, which is not included in net accounting income. The trust is required to distribute the trust income to the beneficiary. The beneficiary will receive

• A) $25,000.
• B) $15,000.
• C) $24,700.
• D) $10,000.

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Definitions:

Parent

In business and accounting, a parent entity controls one or more subsidiary entities.

Consolidation Worksheet

A tool used in accounting to combine the financial statements of a parent company with its subsidiaries to prepare consolidated financial statements.

Intragroup Service

Services provided between companies within the same group, typically involving administrative, technical, or logistical support.

Deferred Tax Liability

A tax obligation that a company owes in the future due to differences between accounting practices and tax regulations.