Cannon Trust School 1
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
- $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
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
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
Which of the following is an example of tangible personal property?
- Gold bar
• Common stock certificate
• Patent
• Vacant land
, Which of the following is an example of tangible personal property?
• Family residence
• IBM stock
- Jewelry
• Rental house
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.
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.
• The asset must be sold and the estate gets 1/2 of the proceeds.
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
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.
Which of the following transfers are includable in the gross estate of the donor if made within 3
years of death?
- Gift of $8,000 cash value life insurance policy to son.
• Gift of $9,800 cash to daughter.
• Gift of $10,000 cash to friend.
• Gift of $5,000 stock in a closely held company to parent.
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
- $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
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
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
Which of the following is an example of tangible personal property?
- Gold bar
• Common stock certificate
• Patent
• Vacant land
, Which of the following is an example of tangible personal property?
• Family residence
• IBM stock
- Jewelry
• Rental house
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.
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.
• The asset must be sold and the estate gets 1/2 of the proceeds.
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
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.
Which of the following transfers are includable in the gross estate of the donor if made within 3
years of death?
- Gift of $8,000 cash value life insurance policy to son.
• Gift of $9,800 cash to daughter.
• Gift of $10,000 cash to friend.
• Gift of $5,000 stock in a closely held company to parent.
