Arlene,who Is Single,reports Taxable Income for 2016 of $112,000

question 109

Essay

Arlene,who is single,reports taxable income for 2016 of $112,000.Calculate her alternative minimum tax,if any,given the following additional information.
​
AMT adjustments
Positive
$22,000
Negative
(25,000)
Tax preferences
46,000

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Definitions:

Differential Cost

The difference in cost between two business decisions, focusing on how costs change under different alternatives.

Product Cost Method

A cost-plus method of price setting in which only the costs of manufacturing the product are included in the cost amount to which the markup is added.

Selling Expenses

Expenses that are incurred directly in the selling of merchandise.

Administrative Expenses

Costs related to the general operation of a business, such as salaries of non-sales personnel, rent, office supplies, and utilities.