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Cannon Trust School 1 Questions and
Correct Answers
Your client owns a $200,000 home in joint tenancy, a $15,000 car
in his own name, an $8,000 CD in his name alone, and a $100,000-
life insurance policy with a cash value of $10,000, payable to his
wife. What is the value of his probate estate?
- $23,000
- $33,000
- $223,000
- $333,000 Ans: $23,000
A simple trust earned $27,000 in dividends. It paid $4,000 in
trustee fees, one-half
from income and one-half from principal. Trust accounting income
is which of the following?
- $0
- $23,000
- $25,000
- $27,000 Ans: $25,000
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If the Trust Document is silent with respect to a certain cash
transaction, the Trust Administrator should first look to which of
the following for guidance?
- Court of Jurisdiction
- Principal and Income Law of the State
- Grantor
- OCC Ans: Principal and Income Law of the State
When determining a long-term sustainable rate of return for a
unitrust payout, which of the following best represents the range
of high confidence payout percentages?
- 1-2%
- 2-3%
- 3-5%
- 120% of the federal midterm rate Ans: 3-5%
Which of the following is an example of tangible personal
property?
- Gold bar
- Common stock certificate
- Patent
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- Vacant land Ans: Gold bar
Which of the following is an example of tangible personal
property?
- Family residence
- IBM stock
- Jewelry
- Rental house Ans: Jewelry
A to B for life, then to C. Following this transfer, which of the
following is true?
- A has a fee simple interest.
- B has a reversionary interest.
- C has a remainder interest.
- C has a life estate. Ans: C has a remainder interest.
Under joint tenants with rights of survivorship, when one tenant
dies which of the following best describes the result?
- Her share passes through her will to her heirs.
- Her share passes by law to her heirs, not through her will.
- Her share passes to the surviving joint tenant regardless of what
her will says.
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- The asset must be sold and the estate gets 1/2 of the proceeds.
Ans: Her share passes to the surviving joint tenant regardless of
what her will says.
A decedent owns $400,000 in his own name, a $200,000 home in
joint tenancy with his spouse and a $100,000 life insurance policy
with the children as beneficiaries. Which of the following is the
amount passing through probate?
- 0.
- $400,000.
- $500,000.
- $700,000. Ans: $400,000
In cutting down a tree, which of the following occurs?
- Real property is converted to personal property.
- Personal property is converted to real property.
- Real property is converted to a fixture.
- There is no conversion, the tree remains real property. Ans: Real
property is converted to personal property.
Which of the following transfers are includable in the gross estate
of the donor if made within 3 years of death?
© 2025 All rights reserved
Cannon Trust School 1 Questions and
Correct Answers
Your client owns a $200,000 home in joint tenancy, a $15,000 car
in his own name, an $8,000 CD in his name alone, and a $100,000-
life insurance policy with a cash value of $10,000, payable to his
wife. What is the value of his probate estate?
- $23,000
- $33,000
- $223,000
- $333,000 Ans: $23,000
A simple trust earned $27,000 in dividends. It paid $4,000 in
trustee fees, one-half
from income and one-half from principal. Trust accounting income
is which of the following?
- $0
- $23,000
- $25,000
- $27,000 Ans: $25,000
© 2025 All rights reserved
, 2 | Page
If the Trust Document is silent with respect to a certain cash
transaction, the Trust Administrator should first look to which of
the following for guidance?
- Court of Jurisdiction
- Principal and Income Law of the State
- Grantor
- OCC Ans: Principal and Income Law of the State
When determining a long-term sustainable rate of return for a
unitrust payout, which of the following best represents the range
of high confidence payout percentages?
- 1-2%
- 2-3%
- 3-5%
- 120% of the federal midterm rate Ans: 3-5%
Which of the following is an example of tangible personal
property?
- Gold bar
- Common stock certificate
- Patent
© 2025 All rights reserved
, 3 | Page
- Vacant land Ans: Gold bar
Which of the following is an example of tangible personal
property?
- Family residence
- IBM stock
- Jewelry
- Rental house Ans: Jewelry
A to B for life, then to C. Following this transfer, which of the
following is true?
- A has a fee simple interest.
- B has a reversionary interest.
- C has a remainder interest.
- C has a life estate. Ans: C has a remainder interest.
Under joint tenants with rights of survivorship, when one tenant
dies which of the following best describes the result?
- Her share passes through her will to her heirs.
- Her share passes by law to her heirs, not through her will.
- Her share passes to the surviving joint tenant regardless of what
her will says.
© 2025 All rights reserved
, 4 | Page
- The asset must be sold and the estate gets 1/2 of the proceeds.
Ans: Her share passes to the surviving joint tenant regardless of
what her will says.
A decedent owns $400,000 in his own name, a $200,000 home in
joint tenancy with his spouse and a $100,000 life insurance policy
with the children as beneficiaries. Which of the following is the
amount passing through probate?
- 0.
- $400,000.
- $500,000.
- $700,000. Ans: $400,000
In cutting down a tree, which of the following occurs?
- Real property is converted to personal property.
- Personal property is converted to real property.
- Real property is converted to a fixture.
- There is no conversion, the tree remains real property. Ans: Real
property is converted to personal property.
Which of the following transfers are includable in the gross estate
of the donor if made within 3 years of death?
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