The Doyle Trust Reports Distributable Net Income for the Year

question 70

Multiple Choice

The Doyle Trust reports 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 $20,000 to Roger and $20,000 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 $25,000 to Roger and $50,000 to Sally. How much gross income from the trust must Roger recognize?

• A) $50,000
• B) $45,000
• C) $40,000
• D) $20,000

Recognize the significance of the corporate veil and circumstances under which it may be pierced.

Differentiate between types of corporations based on incorporation jurisdiction and purpose.

Comprehend the concept of ultra vires acts within corporate actions.

Identify the unique attributes of closely held corporations and strategies to mitigate majority shareholder dominance.

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Definitions:

Lymph Duct

A lymph duct is a large lymphatic vessel that drains lymph from various parts of the body into the bloodstream.

Germinal Center

Specialized zones within lymph nodes or the spleen where mature B cells proliferate, differentiate, and mutate their antibody genes during an immune response.

Capsule

An outer covering or layer, often referring to the fibrous covering over certain organs or structures.

Red Pulp

The portion of the spleen involved in filtering blood and removing old or damaged red blood cells.