ESTATE PLANNING EXAM 1 SAMPLE QUESTIONS
WITH CORRECT VERIFIED ANSWERS |ALL GRADED
A+
Which of the following statements concerning the practice of law is correct?
A) The practice of law is defined by each state.
B) Special circumstances are sometimes given to financial planners to
enable them to draft wills, trust documents, and other legal documents.
C) Reviewing wills to ensure client goals are being addressed is considered
practicing law.
D) A licensed attorney can give anyone the right to practice law as their
agent. - ANS.... -A)The practice of law is defined by each state.
The first step in the estate planning process includes:
A) Meeting with the client to gather information regarding the client's
assets, family structure, current estate planning documents, and desires,
as needed to understand the client's circumstances.
B)Prioritizing the client's goals.
C)Developing a formal written estate plan.
D)Identifying key areas of concern in relation to the client's plan - taxes,
cash on hand, etc. - ANS.... -A)Meeting with the client to gather information
regarding the client's assets, family structure, current estate planning
documents, and desires, as needed to understand the client's
circumstances.
,Everyone has their own objectives with regard to estate planning. Which of
the following objectives is most important for a financial advisor to keep in
mind when counseling a client?
A) Maximize net to heirs.
B) Minimize estate tax.
C) Minimize administrative burdens.
D) Effectively transfer assets. - ANS.... -D) effectively transfer assets.
Skip does not want to write a will. It upsets him to contemplate his own
death and he simply desires to avoid the estate planning process. All of the
following are risks Skip's estate may face due to his inaction, except:
A) Skip's property transfers contrary to his wishes.
B) Skip's estate may face liquidity problems.
C) Skip's estate faces increased estate administration fees.
D) Skip's estate faces increased debt payments for outstanding debts at
death. - ANS.... -D)Skip's estate faces increased debt payments for
outstanding debts at death.
Hardey is a financial planner in the state of Iowa. Although he attended one
year of law school, Hardey is not a licensed attorney. Which of the following
actions would be considered the practice of law?
A) Drafting wills, trust documents, and powers of attorney.
B) Reviewing wills, trust documents, and powers of attorney.
C) Directing a client to seek legal advice from a licensed attorney.
D) Acting as trustee for a client's trust. - ANS.... -A) Drafting wills, trust
documents, and powers of attorney.
Which of the following does not need estate planning?
,A) Jeb, age 30, married with two minor children, and a net worth of
$375,000.
B) Quynh, age 35, never been married, one severely disabled son.
C) Cynthia, age 45, single, has a net worth of $450,000 and two dogs.
D) All of the above need estate planning. - ANS.... -D) All of the above
need estate planning.
Of the following, who should generally be a member of the estate planning
team? 1. Attorney2. Certified Public Accountant (CPA) 3. Life insurance
consultant4. Loan officer
A) 1 and 2.
B) 1 and 4.
C) 1, 2, and 3.
D) 1, 2, 3, and 4 - ANS.... -C) 1, 2, and 3.
Which of the following is a risk of failing to plan for one's estate?
1. Property transfers contrary to the client's wishes.2. The client's family
may not be provided for financially.3. The estate suffers liquidity problems
at the client's death.4. The estate may bear higher transfer costs.
A) 2 only.
B) 2 and 3.
C) 1, 3, and 4.
D) 1, 2, 3, and 4. - ANS.... -D) 1, 2, 3, and 4.
Which of the following statements concerning estate planning is correct?
1. An effective transfer occurs when a person's assets are transferred to
the person or institution intended by that person.2. An efficient transfer
, occurs when transfer costs are minimized consistent with the greatest
assurance of effectiveness.
A) 1 only.
B) 2 only.
C) Both statements 1 and 2.
D) Neither 1 nor 2 - ANS.... -C) Both statements 1 and 2.
Mahogany contacts you by phone. She is 65 and has accumulated over
$3,000,000 in assets. She informs you that she is not married, and wants to
leave all of her assets equally to her three adult children. She agrees to
come meet with you, but asks what she should bring. Which one of the
following items would be least important for Mahogany to bring if the topic
of discussion is estate planning?
A) A copy of her will and any codicils.
B) A copy of children's birth certificates.
C) A copy of life insurance policies.
D) A copy of latest bank statements. - ANS.... -B) A copy of children's birth
certificates.
Who on the estate planning team usually calculates the adjusted basis of
assets and addresses tax issues?
A) Licensed attorney.
B) Certified Public Accountant (CPA).
C) Financial planner.
D) Trust officer. - ANS.... -B) Certified Public Accountant (CPA).
Yara would like to meet with you regarding her estate plan. Yara is 55-
years-old, and currently has an estate that would be subject to estate tax.
Her spouse died of lung cancer last year. Yara has three children, ages 23,
WITH CORRECT VERIFIED ANSWERS |ALL GRADED
A+
Which of the following statements concerning the practice of law is correct?
A) The practice of law is defined by each state.
B) Special circumstances are sometimes given to financial planners to
enable them to draft wills, trust documents, and other legal documents.
C) Reviewing wills to ensure client goals are being addressed is considered
practicing law.
D) A licensed attorney can give anyone the right to practice law as their
agent. - ANS.... -A)The practice of law is defined by each state.
The first step in the estate planning process includes:
A) Meeting with the client to gather information regarding the client's
assets, family structure, current estate planning documents, and desires,
as needed to understand the client's circumstances.
B)Prioritizing the client's goals.
C)Developing a formal written estate plan.
D)Identifying key areas of concern in relation to the client's plan - taxes,
cash on hand, etc. - ANS.... -A)Meeting with the client to gather information
regarding the client's assets, family structure, current estate planning
documents, and desires, as needed to understand the client's
circumstances.
,Everyone has their own objectives with regard to estate planning. Which of
the following objectives is most important for a financial advisor to keep in
mind when counseling a client?
A) Maximize net to heirs.
B) Minimize estate tax.
C) Minimize administrative burdens.
D) Effectively transfer assets. - ANS.... -D) effectively transfer assets.
Skip does not want to write a will. It upsets him to contemplate his own
death and he simply desires to avoid the estate planning process. All of the
following are risks Skip's estate may face due to his inaction, except:
A) Skip's property transfers contrary to his wishes.
B) Skip's estate may face liquidity problems.
C) Skip's estate faces increased estate administration fees.
D) Skip's estate faces increased debt payments for outstanding debts at
death. - ANS.... -D)Skip's estate faces increased debt payments for
outstanding debts at death.
Hardey is a financial planner in the state of Iowa. Although he attended one
year of law school, Hardey is not a licensed attorney. Which of the following
actions would be considered the practice of law?
A) Drafting wills, trust documents, and powers of attorney.
B) Reviewing wills, trust documents, and powers of attorney.
C) Directing a client to seek legal advice from a licensed attorney.
D) Acting as trustee for a client's trust. - ANS.... -A) Drafting wills, trust
documents, and powers of attorney.
Which of the following does not need estate planning?
,A) Jeb, age 30, married with two minor children, and a net worth of
$375,000.
B) Quynh, age 35, never been married, one severely disabled son.
C) Cynthia, age 45, single, has a net worth of $450,000 and two dogs.
D) All of the above need estate planning. - ANS.... -D) All of the above
need estate planning.
Of the following, who should generally be a member of the estate planning
team? 1. Attorney2. Certified Public Accountant (CPA) 3. Life insurance
consultant4. Loan officer
A) 1 and 2.
B) 1 and 4.
C) 1, 2, and 3.
D) 1, 2, 3, and 4 - ANS.... -C) 1, 2, and 3.
Which of the following is a risk of failing to plan for one's estate?
1. Property transfers contrary to the client's wishes.2. The client's family
may not be provided for financially.3. The estate suffers liquidity problems
at the client's death.4. The estate may bear higher transfer costs.
A) 2 only.
B) 2 and 3.
C) 1, 3, and 4.
D) 1, 2, 3, and 4. - ANS.... -D) 1, 2, 3, and 4.
Which of the following statements concerning estate planning is correct?
1. An effective transfer occurs when a person's assets are transferred to
the person or institution intended by that person.2. An efficient transfer
, occurs when transfer costs are minimized consistent with the greatest
assurance of effectiveness.
A) 1 only.
B) 2 only.
C) Both statements 1 and 2.
D) Neither 1 nor 2 - ANS.... -C) Both statements 1 and 2.
Mahogany contacts you by phone. She is 65 and has accumulated over
$3,000,000 in assets. She informs you that she is not married, and wants to
leave all of her assets equally to her three adult children. She agrees to
come meet with you, but asks what she should bring. Which one of the
following items would be least important for Mahogany to bring if the topic
of discussion is estate planning?
A) A copy of her will and any codicils.
B) A copy of children's birth certificates.
C) A copy of life insurance policies.
D) A copy of latest bank statements. - ANS.... -B) A copy of children's birth
certificates.
Who on the estate planning team usually calculates the adjusted basis of
assets and addresses tax issues?
A) Licensed attorney.
B) Certified Public Accountant (CPA).
C) Financial planner.
D) Trust officer. - ANS.... -B) Certified Public Accountant (CPA).
Yara would like to meet with you regarding her estate plan. Yara is 55-
years-old, and currently has an estate that would be subject to estate tax.
Her spouse died of lung cancer last year. Yara has three children, ages 23,
