​Jesse Placed Equipment That Cost $48,000 in Service in 2015

question 116

Multiple Choice

​Jesse placed equipment that cost $48,000 in service in 2015 (neither § 179 expensing nor bonus depreciation was elected) . On July 1, 2017, Jesse sold the equipment for $22,000. ​
Regular tax and AMT depreciation amounts for the equipment are computed as follows.
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What AMT adjustments will be required for the equipment for 2017?
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• A)​$5,844 positive adjustment depreciation; $1,292 positive adjustment equipment sale
• B)​$324 positive adjustment depreciation; $(5,844) negative adjustment equipment sale
• C)$648 positive adjustment depreciation; $(2,276) negative adjustment equipment sale
• D)​$324 positive adjustment depreciation; $0 adjustment for the equipment sale

Understand the role and function of special journals in the accounting cycle.

Apply the rules for revenue and expense recognition under the accrual basis.

Distinguish between permanent and temporary accounts and their roles in the accounting cycle.

Describe the impact of specific transactions on financial statements.

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Definitions:

Marginal Utility

The extra pleasure or benefit gained by a consumer from consuming an additional unit of a product or service.

Marginal Utility

The additional satisfaction or utility gained from consuming an extra unit of a good or service.

Water-Diamond Paradox

A concept in economics that questions why diamonds are more expensive than water despite water being essential for survival and diamonds not.

Marginal Utility

The additional satisfaction or benefit received from consuming one more unit of a good or service.