SQE1 sample questions

Question 57

A firm of solicitors is acting for the executors of a deceased man’s estate. It has just obtained the grant of probate. When it applied for the grant of probate, the firm paid the probate application fee of £273 from its business bank account. The firm receives £5,225 from the deceased man’s bank, being the closing balance of the deceased man’s account with the bank, which it pays into its general client bank account.

The firm has received, but not yet paid, an invoice for £100 (no VAT payable) addressed to the firm from a local valuer who provided a probate valuation of the deceased man’s furniture.

The firm submits a bill to the executors as follows:

Professional charges                              £1,000
VAT                                                            £200
Paid disbursement (probate fee)         £273
Unpaid disbursement (valuation fee)  £100
Total £1,573

What is the maximum amount the firm can transfer to its business bank account?

A. £1,000

B. £1,273

C. £1,200

D. £1,300

E. £1,573