In reference to estate principal and income,which of the following statements is correct?

Question

Quizplus · Accepted Answer

Dividing estate principal and estate income is primarily done because the beneficiaries of each are often different. Estate principal refers to the assets owned by the decedent at the time of death, while estate income refers to the earnings generated by those assets after the decedent's death. Option B is incorrect because the receipts earned but not received at the date of death are considered part of the estate principal. Option C is incorrect because earnings from income-producing property after the decedent's death are considered estate income, not estate principal. Option D is incorrect because expenses incurred to administer the estate are first charged against the estate principal, not income earned after death.

In Reference to Estate Principal and Income,which of the Following