Interest Income on Private Activity Bonds Issued in 2015 Reduced

question 93

True/False

Interest income on private activity bonds issued in 2015 reduced by expenses incurred in carrying the bonds is a preference item that is included in computing AMTI.

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Definitions:

Fair Value

The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

Book Value

The value of a company's assets as recorded in its financial statements, minus the company's total liabilities and intangible assets such as goodwill.

Goodwill

An intangible asset that arises when a buyer acquires an existing business and pays a price higher than the fair value of the identifiable tangible and intangible assets.

Merger Transaction

A corporate action where two or more companies are consolidated into one entity, often to enhance competitiveness or grow market share.