ADVANCED ACCOUNTING
ADVANCED ACCOUNTING
12th Edition
ISBN: 9780357671221
Author: FISCHER
Publisher: CENGAGE L
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Chapter 20, Problem 1UTI
To determine

Concept Introduction:

The net assets held with an individual at the time of his/ her death or incapacitation are referred to as an estate. The planning to manage such assets of an individual is regarded as estate planning.

To define:The importance and goals of estate planning.

Expert Solution & Answer
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Explanation of Solution

Many individuals prefer estate planning as it is as per their desires. While estate planning, the accountant or attorney needs to consider two strategies i.e. estate taxes and gift-giving. The person who is responsible forthe management of an individual’s assets by law is regarded as fiduciaries. These fiduciaries prepared an accounting report based on their actions.

Some of the goals of estate planning are as follows:

  • Define and communicate the desires of a deceased individual.
  • Ensure proper management and administration of estate to satisfy a decedent’s desires.
  • Enhance the value of existing assets of an individual before death by proper planning.
  • Reduce the value of taxes that may be assessed against the income or estate.
  • Proper accounting of the estates on a timely basis.

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