This Year, the Nano Trust Reported $50,000 Entity Accounting Income

question 18

Multiple Choice

This year, the Nano Trust reported $50,000 entity accounting income and $40,000 distributable net income (DNI) . Nano distributed $60,000 cash to Horatio, its sole income beneficiary. Nano is a simple trust. Nano's distribution deduction is:

• A) $60,000.
• B) $50,000.
• C) $40,000.
• D) $0.

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Definitions:

Catskill Delta

An ancient delta located in what is now the northeastern United States, known for its rich sediments that tell a story of Earth’s geological past.

Foreland Basin

A structural basin that forms adjacent to a mountain belt, typically filled with sediments eroded from the mountains.

Passive Margin

A tectonically inactive edge of a continent along which there is no significant volcanic or earthquake activity, typically characterized by a broad continental shelf.

Compression

The act of pressing together; in geology, it refers to the stress applied to materials causing a decrease in volume or shortening.