Problem $18-37($LO$.6)$

At the time of his death this year on September $4,$ Kenneth owned the following assets, among others:

$$Fair Market ValueHouston $($TX$)$ Independent School District bonds$$2,500,000$Stock in Brown Corporation$900,000$Promissory note issued by Brad $($Kenneth$\text{'}$s son$)600,000$

In October, the executor of Kenneth's estate received the following: $$120,000$ interest on the Houston $($TX$)$ Independent School District bonds $($$$10,000$ accrued since September $4),$ and a $$7,000$ cash dividend on the Brown stock $($date of record was September $3).$ The declaration date on the dividend was August $12.$ Assume that the school district is solvent.

The $$600,000$ loan was made to Brad in late $2019.$ Kenneth's will does not forgive Brad's note. The business that Brad started with the loan funds was not successful, and the note has a zero value $($note is considered worthless$).$

What are the estate tax consequences of these transactions?

Indicate whether each of the items below should be "Included", "Excluded" or "Partially Included$/$Excluded$"$ from Kenneth's gross estate.