Fran Dies on January 14, 2014

question 37

Multiple Choice

Fran dies on January 14, 2014. Her spouse, Carl, is the beneficiary of a $100,000 life insurance policy. Carl elects to receive the proceeds in 10 equal installments of $11,000. In 2014, Carl receives $11,000. The amount included in Carl's 2014 gross income is

• A) $ - 0 -
• B) $ 1,000
• C) $ 10,000
• D) $ 11,000
• E) $111,000

Identify the significance of separating personal and business finances.

Grasp the basic concepts and terminology of accounting and financial management.

Acknowledge the common reasons for small business bankruptcy and the importance of strategic financial planning and management.

Understand the purpose and importance of financial statements in a business.

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Definitions:

Private Benefits

The gains or advantages that accrue directly to an individual or firm from an economic transaction or activity, not affecting others not involved in the transaction.

Negative Externality

A cost that affects a party who did not choose to incur that cost, often associated with production or consumption of goods and services.

Property Value

The market worth of real estate, influenced by factors such as location, amenities, and the condition of the property.

External Cost

A cost that is not borne by the parties to an economic transaction, often affecting third parties who did not choose to incur that cost.