Vicki Owns and Operates a News Agency (As a Sole

question 116

Multiple Choice

Vicki owns and operates a news agency (as a sole proprietorship) . During 2014, she incurred expenses of $24,000 to increase circulation of newspapers and magazines that her agency distributes. For regular income tax purposes, she elected to expense the $24,000 in 2014. In addition, Vicki incurred $15,000 in circulation expenditures in 2015 and again elected expense treatment. What AMT adjustments will be required in 2014 and 2015 as a result of the circulation expenditures?

• A) $16,000 positive in 2014, $2,000 positive in 2015.
• B) $16,000 negative in 2014, $2,000 positive in 2015.
• C) $16,000 negative in 2014, $10,000 positive in 2015.
• D) $16,000 positive in 2014, $10,000 positive in 2015.
• E) None of the above.

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Definitions:

Moisture Absorption

The process by which a substance takes in moisture from its environment, often relevant in materials science and skin care.

Darkly Pigmented

Description of a skin or area that has a deeper or more intense colorization than the surrounding tissues, often due to higher levels of melanin.

Edema

Swelling caused by excess fluid trapped in the body's tissues.

Pallor

An abnormal loss of color from the skin or mucous membranes, often indicative of illness, stress, or poor blood circulation.