In 2016,Linda Incurs Circulation Expenses of $240,000 Which She Deducts

question 73

Essay

In 2016,Linda incurs circulation expenses of $240,000 which she deducts in calculating taxable income.
a.Calculate Linda's AMT adjustment for circulation expenses for 2016,2017,2018,and 2019.
b.Advise Linda on how she could reduce or eliminate the AMT adjustment in 2016.

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Definitions:

Fees Earned

Revenue recognized by a company or individual in exchange for services rendered.

Adjusted Trial Balance

A financial statement listing all the accounts and their final balances after all adjustments have been made.

Closing Entries

At the end of an accounting cycle, transactions are recorded to shift balances from provisional accounts to lasting accounts.

Post-closing Trial Balance

A summary of all account balances after closing entries are made, used to check the balance of debits and credits.