Apple Trust Reports Net Accounting Income of $40,000, All from Taxable

question 1

Multiple Choice

Apple Trust reports net accounting income of $40,000, all from taxable sources. The trustee is required to distribute $15,000 annually to Megan. The trustee also makes discretionary distributions of $30,000, $7,500 to Megan and $22,500 to Caroline. The trust pays $5,000 of the discretionary distributions from corpus. What is the amount of the distribution deduction?

• A)$40,000
• B)$45,000
• C)$15,000
• D)$30,000

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Definitions:

Precausal Thinking

A type of reasoning typical in early childhood where logic is not yet developed, leading to conclusions that don't follow logically from their premises.

Transductive Reasoning

A type of reasoning, especially noted in young children, where individuals make inferences from one specific event to another, often without understanding the underlying causal relationships.

Three Mountains Task

A cognitive development test used to assess a child’s ability to recognize different perspectives and viewpoints.

Perspective

A specific perspective or manner of looking at something; an outlook.