The Suarez Trust Generated Distributable Net Income (DNI) This Year

question 7

Multiple Choice

The Suarez Trust generated distributable net income (DNI) this year of $150,000, one-third of which was portfolio income, and the balance of which was exempt interest.Under the terms of the trust, Clara Suarez is to receive an annual income distribution of $30,000.At the discretion of the trustee, additional distributions can be made to Clara, or to Clark Suarez III.This year, the trustee's distributions to Clara totaled $90,000.Clark also received $90,000.How much of the trust's DNI is assigned to Clark?

• A)$0, only first-tier distributions are subject to Federal income tax.
• B)$72,000.
• C)$75,000.
• D)$90,000.

Understand the concept of goodwill and how it is treated in financial statements.

Grasp the treatment and recognition of costs associated with research and development, and the amortization of intangible assets.

Acquire knowledge on the financial accounting implications of equipment exchanges with and without commercial substance.

Learn about the accounting for natural resources, including the concept of depletion.

---

Definitions:

REM Paralysis

A phenomenon during the REM (Rapid Eye Movement) sleep phase where the body is temporarily paralyzed, preventing the sleeper from acting out dreams.

Memory

The faculty by which the mind stores and remembers information.

Sleep

A naturally recurring state of mind and body characterized by altered consciousness, relatively inhibited sensory activity, and inhibition of nearly all voluntary muscles.

Premenstrual Syndrome

A collection of emotional symptoms, with or without physical symptoms, related to a woman's menstrual cycle.