The AMT Adjustment for Mining Exploration and Development Costs Can

question 9

True/False

The AMT adjustment for mining exploration and development costs can be avoided if the taxpayer elects to deduct the expenditures in the year incurred for regular income tax purposes rather than writing off the expenditures over a
10-year period for regular income tax purposes.

---

Definitions:

Accrued Warranty Costs

Costs anticipated for the future repair or replacement of products, recognized in financial statements before the costs are actually incurred.

Pretax Accounting Income

The income an organization has earned before any taxes have been deducted, used to calculate taxable income after adjusting for any differences between accounting and tax regulations.

Enacted Tax Rate

The tax rate established by law that is applied to income or transactions.

Income Tax Expense

The total amount of income tax a company expects to pay to tax authorities relative to its taxable income.