An Inter Vivos Trust Was Created by Isaac Posney Required:
Prepare All Required Journal Entries for This Trust Fund

question 74

Essay

An inter vivos trust was created by Isaac Posney. Isaac owned a large department store in Juggins, Utah. Adjacent to the store, Isaac also owned a tract of land that was used as an extra parking lot when the store was having a sale or during the Christmas season. Isaac expected the land to appreciate in value and eventually be sold for an office complex or additional stores.
Isaac placed the land into a charitable lead trust which would hold the land for ten years until Isaac's son would turn 21. At that time, title would be transferred to the son. The store will pay rent to use the land during the interim. The income generated each year from this usage will be given to a local church. The land was currently valued at $416,000.
During the first year of this arrangement, the trustee recorded the following cash transactions: $$\begin{array}{l}\text { Cash inflow: }\\\begin{array} { l r } \text { Rental income } & \$ 78,000 \\\text { Cash outflows: } & \\\text { Insurance } & \$ 5,200 \\\text { Property taxes } & 7,800 \\\text { Paving (considered an extraordinary repair) } & 5,600 \\\text { Maintenance } & 10,400 \\\text { Distribution to income beneficiary } & 39,000\end{array}\end{array}$$
Required:
Prepare all required journal entries for this trust fund including the entry to create the trust.

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Definitions:

Team Awards

Recognition given to a group of people for their collective performance or achievements in a particular project or area of work.

Bonuses

Additional financial compensation given to employees as a reward for good performance, over and above their regular salary.

Cooperation

The act of working together towards a common goal, often emphasizing teamwork and mutual assistance.

Deadlines

Specific dates or times by which tasks must be completed or submissions must be made.