How do debts influence the administration of an estate?

The correct answer highlights the critical role that debts play in the administration of an estate by stipulating that debts must be resolved before beneficiaries receive their inheritances. This aligns with the principle of ensuring that the deceased's obligations are satisfied before any distribution of assets to heirs or beneficiaries occurs.

When an individual passes away, their estate is responsible for settling any outstanding debts or obligations. This process typically involves evaluating the estate’s assets, settling any valid claims against the estate, and only after those debts are resolved can the remaining assets be distributed to the heirs according to the will, or according to the laws of intestacy if there is no will. This ensures that creditors are paid and that the estate is administered fairly and legally.

The other positions presented in the question fail to accurately reflect this priority. For example, the notion that debts have no impact disregards the necessity of debt settlement in the estate process. Similarly, the suggestion that debts are paid after beneficiaries receive their inheritances conflicts with the legal obligation of estates to honor debts prior to distributions. Lastly, the option stating that debts are settled by the guardian of the estate is misleading since, while a guardian may oversee certain aspects of an estate, typically, the executor or administrator is responsible for debt payments.