Bac 411: Trust And Executorship Question Paper
Exam Name: Bac 411: Trust And Executorship
Course: Bachelor Of Commerce
Category: Kenyatta University question papers
UNIVERSITY EXAMINATIONS 2011/2012
SECOND SEMESTER EXAMINATION FOR THE DEGREE OF BACHELOR OF
BAC 411: TRUST AND EXECUTORSHIP LAW AND ACCOUNTS
DATE: MONDAY, 26TH MARCH 2012 TIME: 4.30 P.M. – 6.30 P.M.
Describe the main provision of the Law of Succession Act (Cap 160).
Define a gift and clearly explain FIVE reasons why testamentary gifts can fail.
Explain any FIVE duties a trustee.
Onyango died on 1st July 2005 and on his will, he left to his wife for her life and on her death to his
younger son Andrew absolutely. He left the residue of his estate to be held on trust for the benefit of
his wife and on her death, to be shared amongst his other children Judy, Joseph and John. His will
gave no other information as to the investment of funds. On 1st July 2005, his house was valued at
Shs2,000,000. He held 20,000 shared of Shs10 each in NIC Bank valued at Shs54-56 and
Shs1,000,000 15% Kenya Government Bond valued at 94-96 and Shs300,000 in the bank.
His debt and funeral expenses amounted to Shs40,000.
On 31st December 2005, NIC Bank Shares were quoted at Shs58-60 and 15% Government Bond
was quoted at 92-94.
Estate Capital Account
Balance Sheet on 31st December 2005
Page 1 of 3
List and explain five powers of an executor.
Explain the circumstances under which a new trustee may be appointed in an
Describe the following terms as used in executorship
(2 1 marks)
(2 1 marks)
Peter Mwangi died on 1st January 2010 leaving the following estate:
Local SAACO deposits
Interest accrued of SAACO deposit
6000 ordinary shares of Shs20 each in ABC Ltd
2000 Ordinary shares of Sh20 each in Maji Ltd.
Balance at Bank
Personal and household effects
Shs1,000,000 12% Government stocks
Debts due to be paid by Peter Mwangi amounted to Shs.12,800.
The funeral expenses incurred upon his death amounted to Shs68,400.
Peter Mwangi had in his will made the following bequest.
To my wife Jane household and personal effects and sum of Shs.100,000
To my son Johny and Luke the sum of Shs.50,000 each.
To my brother Simon, my holding of Shs1,000 ordinary share in Maji Ltd.
To my sister Grace the sum of Shs40,000.
To my daughter Penny, the sum of Shs.70,000.
Page 2 of 3
The following transaction took place during the four months ended 30th April 2010
1st January 2010:
Received dividend 10% for the year ended 31st December 2009.
Share on ABC Ltd and half year’s interest on the 12% Government
stocks to date.
1st February 2010:
Received sums of Shs495,000, Shs110,000, Shs1,100,000 being net proceeds
from the sale of freehold property, share in ABC Ltd and 12% Government
2nd March 2010:
Paid tax amounting to Shs104,000
30th March 2010:
Withdrew balance of Shs.490,000 from local SAACO deposits including interest
accrued on SAACO deposits to date.
31st March 2010:
Paid administration expenses of Shs26,400 (all capital) together with debts due
and funeral expenses.
You further ascertain the following:
Peter Mwangi was survived by his wife Jane, his son Johny, daughter Penny and brother
Luke and Grace died in a road accident in May 2009.
Luke was survived by his widow Beth who had no children.
Grace was survived by her two sons, Steve and Joe.
All legacies were distributed on 30th April 2010.
Estate Capital Account
Estate cash book
Page 3 of 3
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