The Roz Trust Has Distributable Net Income for the Year

question 38

Multiple Choice

The Roz Trust has distributable net income for the year of $100,000 and no income from tax-exempt sources.Under the terms of the trust instrument,the trustee must distribute $80,000 to Roger and $80,000 to Sally.After paying these amounts,the trustee is empowered to make additional distributions at its discretion.Exercising this authority,the trustee distributes an additional $40,000 to Roger and $20,000 to Sally.How much gross income from the trust must Sally recognize?

• A)$50,000.
• B)$75,000.
• C)$80,000.
• D)$100,000.

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Definitions:

Complement Rates

In probability, the complement of an event's rate, representing the likelihood of the event not occurring.

Net Price

The actual price paid for a product or service after subtracting any discounts, rebates, or other deductions from the list or sticker price.

Complement Method

A technique used in mathematics to find the complement of a set or in digital electronics to simplify calculations.

Trade Discount

A reduction in the retail price of goods or services offered to wholesalers or those buying in bulk, often based on volume or quantity purchased.