At the Time of His Death,Jacque Was a Participant in Ivory

question 104

Multiple Choice

At the time of his death,Jacque was a participant in Ivory Corporation's qualified pension plan and group term life insurance.The balance in his pension plan is:

The term insurance has a maturity value of $100,000.All amounts are paid to Penny,Jacque's daughter.One result of these transactions is:

• A)Penny must pay income tax on $400,000.
• B)Penny must pay income tax on $900,000.
• C)Jacque's gross estate must include $1,300,000.
• D)Jacque's gross estate must include $1,900,000.
• E)None of the above.

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Definitions:

Income Statement

A financial statement that shows a company's revenues and expenses over a specific period, culminating in the net income.

Interest Income

Income earned on various forms of investments like savings accounts, bonds, or loans, essentially any receivable that accumulates interest.

Debt Financing

Raising funds through borrowing, typically by issuing bonds or taking out loans, which entails repayment of principal and interest.

Equity Financing

The method of raising capital by selling company shares to investors. In return, shareholders receive ownership interests in the company.