If Death Occurs Within Three Years of a Lifetime Gift

question 34

Multiple Choice

If death occurs within three years of a lifetime gift of a life insurance policy, the insurance proceeds:

• A) Cannot be paid to the beneficiary
• B) Are never subject to estate taxes
• C) Are added back in the estate of the donor insured
• D) Must be returned to the insurance company
• E) Are paid to the surviving spouse, even if the spouse is not the named beneficiary

---

Definitions:

Total Factory Overhead

Total factory overhead encompasses all indirect costs associated with manufacturing, including utilities, depreciation, and salaries for supervisory personnel, that cannot be directly traced to specific products.

Activities Per Product

The specific tasks or operations that need to be completed in order to produce each unit of a product.

Activity Cost Reduction

Initiatives or strategies aimed at lowering the costs associated with specific business activities or processes.

Activity-Based Costing

A costing method that allocates overhead and indirect costs to related products and services based on their usage of resources.