Question 1

What is an amendment of a will called?

Accepted Answer

A) Bequest 
B) Residuary 
C) Advance directive 
D) Codicil 
A) Bequest 
B) Residuary 
C) Advance directive 
D) Codicil

Question 2

Which of the following terms is used for an heir born after the execution of the testator's will?

Accepted Answer

A) dower 
B) curtsey 
C) pretermitted 
D) bequest 
A) dower 
B) curtsey 
C) pretermitted 
D) bequest

Question 3

As part of creating an estate plan,an attorney will likely do all of the following,except:

Accepted Answer

A) distribute property to beneficiaries. 
B) take an inventory of the client's assets. 
C) learn the client's objectives. 
D) draft the instruments necessary to carry out the plan. 
A) distribute property to beneficiaries. 
B) take an inventory of the client's assets. 
C) learn the client's objectives. 
D) draft the instruments necessary to carry out the plan.

Question 4

Which of the following is true of a spendthrift trust?

Accepted Answer

A) The settlor can make himself the beneficiary. 
B) It restricts the voluntary transfer of a beneficiary's interest. 
C) Assignees can claim rights to it. 
D) Creditors can claim rights to it. 
A) The settlor can make himself the beneficiary. 
B) It restricts the voluntary transfer of a beneficiary's interest. 
C) Assignees can claim rights to it. 
D) Creditors can claim rights to it.

Question 5

If a person dies intestate,his real property will be distributed:

Accepted Answer

A) to the state in which the property is located. 
B) to the state of the person's domicile. 
C) according to the law of the state in which the property is located. 
D) according to the law of the state of the person's domicile. 
A) to the state in which the property is located. 
B) to the state of the person's domicile. 
C) according to the law of the state in which the property is located. 
D) according to the law of the state of the person's domicile.

Question 6

A(n)________ is a legal relationship in which a person who has legal title to property has the duty to hold it for the use or benefit of another person.

Accepted Answer

A) accession 
B) lien 
C) trust 
D) codicil 
A) accession 
B) lien 
C) trust 
D) codicil

Question 7

An estate is all of the property that an individual owns.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following spendthrift clauses is enforceable?

Accepted Answer

A) A settlor uses a spendthrift clause in a trust that lists him as the beneficiary. 
B) A settlor uses a spendthrift clause to prevent his grandson from foolishly spending his assets. 
C) A spendthrift clause that protects the beneficiary from creditors who have furnished necessaries. 
D) A spendthrift clause that protects the beneficiary from being subject to paying child support payments. 
A) A settlor uses a spendthrift clause in a trust that lists him as the beneficiary. 
B) A settlor uses a spendthrift clause to prevent his grandson from foolishly spending his assets. 
C) A spendthrift clause that protects the beneficiary from creditors who have furnished necessaries. 
D) A spendthrift clause that protects the beneficiary from being subject to paying child support payments.

Question 9

A joint will:

Accepted Answer

A) can only have a single beneficiary. 
B) is only valid if the testators are a married couple. 
C) is a single instrument that constitutes the will of both or all of the testators. 
D) cannot be changed once it is created. 
A) can only have a single beneficiary. 
B) is only valid if the testators are a married couple. 
C) is a single instrument that constitutes the will of both or all of the testators. 
D) cannot be changed once it is created.

Question 10

A trust that is established in a person's will and that takes effect only upon that person's death is called a(n):

Accepted Answer

A) inter vivos trust. 
B) spendthrift trust. 
C) Totten trust. 
D) testamentary trust. 
A) inter vivos trust. 
B) spendthrift trust. 
C) Totten trust. 
D) testamentary trust.

Question 11

In her will,Beth devised her house to her friend,Janet.When Beth died,Janet took possession over the house and Beth's estate contained $300,000 of ungifted cash.A few days later,Janet learned the house Beth gifted to her was subject to a $120,000 mortgage.Which of the following statements is true?

Accepted Answer

A) Janet is entitled to $120,000 from the estate to make her gift whole. 
B) Janet is entitled to $120,000 from the estate because Beth's will devised the house without mention that it was subject to a mortgage. 
C) Janet is entitled to $120,000 plus any reasonable attorney fees from the estate because it was Beth's intent for her to receive the property without any outstanding claims. 
D) Janet is not entitled to $120,000 from the estate and if she keeps the house,she will be liable for any outstanding claims against it. 
A) Janet is entitled to $120,000 from the estate to make her gift whole. 
B) Janet is entitled to $120,000 from the estate because Beth's will devised the house without mention that it was subject to a mortgage. 
C) Janet is entitled to $120,000 plus any reasonable attorney fees from the estate because it was Beth's intent for her to receive the property without any outstanding claims. 
D) Janet is not entitled to $120,000 from the estate and if she keeps the house,she will be liable for any outstanding claims against it.

Question 12

Joe Smith has just died.Three months ago,when he knew that his death was impending,Joe established a spendthrift trust for the protection of his 16-year old son Bobby.The trust property consists mainly of $500,000 in investment securities.The trustee is Jack Purdy,a CPA.The trust agreement does not discuss the trust's termination.Can Jack invest trust assets differently than Joe invested them? For example,can he sell trust securities and buy others? Why or why not? Must Jack hire an investment professional to make trust investments?

Accepted Answer

Jack must use a reasonable degree of ski

Question 13

Which of the following provides that where two persons who would inherit from each other (such as husband and wife)die under circumstances that make it difficult or impossible to determine who died first,each person's property is to be distributed as though he or she survived?

Accepted Answer

A) Uniform Probate Act 
B) Patient Self-Determination Act 
C) Uniform Estate Planning Act 
D) Uniform Simultaneous Death Act 
A) Uniform Probate Act 
B) Patient Self-Determination Act 
C) Uniform Estate Planning Act 
D) Uniform Simultaneous Death Act

Question 14

A testator's children would be called his issue.

Accepted Answer

A) True 
 B)False

Question 15

Because joint tenancy and life insurance are ways of directing the disposition of property,they are sometimes referred to as ________.

Accepted Answer

A) will replacements 
B) will substitutes 
C) equity wills 
D) contract wills 
A) will replacements 
B) will substitutes 
C) equity wills 
D) contract wills

Question 16

Thomas wants to create an inter vivos trust for the benefit of his adult children.To create a valid inter vivos trust,he must have a level of mental capacity that is the same as that required to:

Accepted Answer

A) make a valid contract. 
B) make a valid will. 
C) stand trial in a criminal case. 
D) testify under oath in a criminal case. 
A) make a valid contract. 
B) make a valid will. 
C) stand trial in a criminal case. 
D) testify under oath in a criminal case.

Question 17

Under the laws of some states,the birth of a child after the execution of a will may operate as a partial revocation of the will.

Accepted Answer

A) True 
 B)False

Question 18

The property held in trust is called the ________.

Accepted Answer

A) attachment 
B) lien 
C) corpus 
D) accession 
A) attachment 
B) lien 
C) corpus 
D) accession

Question 19

Jim created a valid will in 2003.Three years later,he wanted to make some minor changes to the will.Jim wants to modify the provisions of his will without making an entirely new will.He can amend his will by executing a(n)________.

Accepted Answer

A) bequest 
B) residuary 
C) advance directive 
D) codicil 
A) bequest 
B) residuary 
C) advance directive 
D) codicil

Question 20

Which of the following is true of testamentary capacity?

Accepted Answer

A) A person must be in perfect mental health to have testamentary capacity. 
B) A person must be 18 years of age (in most states)in order to have testamentary capacity. 
C) A person must have personal property to have testamentary capacity. 
D) A person must have real property to have testamentary capacity. 
A) A person must be in perfect mental health to have testamentary capacity. 
B) A person must be 18 years of age (in most states)in order to have testamentary capacity. 
C) A person must have personal property to have testamentary capacity. 
D) A person must have real property to have testamentary capacity.

Exam 26: Estates and Trusts

What is an amendment of a will called?

Which of the following terms is used for an heir born after the execution of the testator's will?

As part of creating an estate plan,an attorney will likely do all of the following,except:

Which of the following is true of a spendthrift trust?

If a person dies intestate,his real property will be distributed:

A(n)________ is a legal relationship in which a person who has legal title to property has the duty to hold it for the use or benefit of another person.

An estate is all of the property that an individual owns.

Which of the following spendthrift clauses is enforceable?

A joint will:

A trust that is established in a person's will and that takes effect only upon that person's death is called a(n):

In her will,Beth devised her house to her friend,Janet.When Beth died,Janet took possession over the house and Beth's estate contained $300,000 of ungifted cash.A few days later,Janet learned the house Beth gifted to her was subject to a $120,000 mortgage.Which of the following statements is true?

Which of the following provides that where two persons who would inherit from each other (such as husband and wife)die under circumstances that make it difficult or impossible to determine who died first,each person's property is to be distributed as though he or she survived?

A testator's children would be called his issue.

Because joint tenancy and life insurance are ways of directing the disposition of property,they are sometimes referred to as ________.

Thomas wants to create an inter vivos trust for the benefit of his adult children.To create a valid inter vivos trust,he must have a level of mental capacity that is the same as that required to:

Under the laws of some states,the birth of a child after the execution of a will may operate as a partial revocation of the will.

The property held in trust is called the ________.

Jim created a valid will in 2003.Three years later,he wanted to make some minor changes to the will.Jim wants to modify the provisions of his will without making an entirely new will.He can amend his will by executing a(n)________.

Which of the following is true of testamentary capacity?

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