The Executor of Danny Mack's Estate Has Listed the Following

question 51

Essay

The executor of Danny Mack's estate has listed the following properties at fair value: Cash $200,000, Life Insurance Receivable $500,000, Investment in Stocks and Bonds $50,000, Rental Property $100,000, and Personal Property $80,000. Additionally, the executor found $100,000 of various debts incurred before the decedent's death. The cost of Danny Mack's funeral was $20,000.Prepare the journal entry to record the sales of the stocks and bonds for $120,000.

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Definitions:

Dividend Pricing Models

Financial models used to determine the value of a stock based on the dividends it is expected to yield, taking into account future dividends and the discount rate.

Intrinsic Value

The perceived or calculated true value of an asset, investment, or company, based on underlying characteristics and not market price.

Forecasted Cash Flows

Projected movements of cash in and out of a business, used for budgeting and financial planning.

Fixed Maturity

The predetermined date on which an investment, often a bond or other fixed-income security, matures and the principal is supposed to be repaid.