At the Time of Her Death, Megan Was Involved in the Following

question 133

Multiple Choice

At the time of her death, Megan was involved in the following.
? Owned an insurance policy on the life of her father with a replacement cost of $250,000 and maturity value of $800,000. The designated beneficiary of the policy is Megan's estate.
? Was an equal tenant in common with her brother in a tract of land worth $800,000. The land was inherited from their grandmother 10 years ago when it had a value of $200,000.
? Was a joint tenant with her two sisters in stock worth $1,500,000. The stock was inherited from their grandmother 10 years ago when it had a value of $500,000.
As to these transactions, Megan's gross estate must include:

• A) $250,000.
• B) $1,150,000.
• C) $1,400,000.
• D) $2,150,000.
• E) None of the above.

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Definitions:

Notes Payable

A liability in a company's balance sheet that records amounts the company owes because it borrowed money, or a formal written agreement to pay a specific amount in the future.

Maturity Value

The amount of the note that is due on the date of maturity (Principal + Interest).

Principal Amount

The original sum of money borrowed in a loan, or the original investment in a financial instrument, before interest.