The Gable Trust reports $20,000 business income and $10,000 exempt interest income, and it paid a $3,000 fiduciary fee. Gable's distributable net income includes $10,000 of net tax-exempt interest income.

Question

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Distributable Net Income (DNI) does not include tax-exempt interest income such as the $10,000 exempt interest income mentioned, as DNI is used to determine the taxable income distributed to beneficiaries and tax-exempt income is not taxable.

The Gable Trust Reports $20,000 Business Income and $10,000 Exempt