The Code Defines a Simple Trust as Which of the Following

question 105

Multiple Choice

The Code defines a simple trust as which of the following?

• A) One that is allowed to file Form 1041-EZ.
• B) One that has only one income beneficiary.
• C) One whose grantor was an individual who still is alive.
• D) One that must distribute its accounting income every year.

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Definitions:

Acquisition

The process by which a company purchases most or all of another firm's shares to take control of that company.

Fair Value

The estimated market price of an asset or liability, based on current conditions between knowledgeable, willing parties.

Credit Balance

Occurs when the total amounts of credits in an account exceed the total amounts of debits, often indicating an amount owed to the account holder.

Common Stock

A type of equity security that represents ownership in a corporation, with holders possibly entitled to vote on corporate matters and receive dividends.