FET Example

.docx
School
California State University, Chico **We aren't endorsed by this school
Course
FINANCE 351
Subject
Accounting
Date
Oct 22, 2023
Pages
1
Uploaded by BaronRaven3584 on coursehero.com
Leonard is married to Penny and they live together in California. Leonard and Penny married in 2015 and now have one child. Leonard has died. Leonard had a retirement account from his prior employer, ABC Corp., whom he stopped working for in 2014 worth $100,000 at time of death. He also had some stock from that employer and had 100 shares of ABC Corp. The shares were worth $10 a share when he left ABC Corp. in 2014 but are now worth $100 a share upon his death. Penny has worked for XYZ Corp. for 10 years and has 1,000 shares of stock in XYZ Corp. Half of the stock was acquired before her marriage to Leonard and the other half was acquired after her marriage to Leonard as her compensation. All stock was acquired at $1 per share, and is now worth $1,000 per share upon Leonard's death. Leonard and Penny continued working and used their assets earned post 2015 to purchase a home in 2017. The home was acquired for $1.5M with a $1M mortgage and at the time of Leonard's death is worth $2M and the mortgage is currently at $850K. The home is titled as community property. Leonard and Penny also have a vacation property in Arizona that they acquired before they were married that is 30% owned by Leonard and 70% owned by Penny worth $100,000 when they purchased it and $200,000 at the time of Leonard's death. They own another vacation property purchased before marriage that is held in joint tenancy in Montana. It was worth $50,000 when they purchased and $150,000 at the time of Leonard's death. Leonard also had a $500,000 life insurance policy through his current employer that paid to Penny. Leonard and Penny have no creditors, other than the mortgage. Penny is the beneficiary of Leonard's life insurance policy and his retirement account. Leonard's Will provides for a $1,000,000 specific gift to his child and the remaining assets to be distributed to Penny. Leonard gave $11,000,000 in gifts before he passed away. Leonard's Administrative Expenses were $100,000.
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