The Eagleton Trust Generated Distributable Net Income (DNI)this Year of $120,000,one-Third

question 117

Multiple Choice

The Eagleton Trust generated distributable net income (DNI) this year of $120,000,one-third of which was portfolio income,and the balance of which was exempt interest.Under the terms of the trust,Clara Eagleton is to receive an annual income distribution of $40,000.At the discretion of the trustee,additional distributions can be made to Clara or to Clark Eagleton III.This year,the trustee's distributions to Clara totaled $60,000.Clark also received $60,000.How much of the trust's DNI is assigned to Clara?

• A)$80,000.
• B)$60,000.
• C)$50,000.
• D)$40,000.

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Definitions:

Expected Growth Rate

Represents the anticipated annual rate at which an investment, company, or economy will grow over a specified period.

Rate of Return

The gain or loss of an investment over a specific period, expressed as a percentage of the investment's initial cost.

Dividend

A portion of a company's earnings distributed to its shareholders, usually in the form of cash or stock.

Expected Growth Rate

The anticipated rate at which a company, asset, or economy is expected to grow in the future.