In 2014, May Corporation (A Calendar Year Taxpayer) Had the Following

question 89

Multiple Choice

In 2014, May Corporation (a calendar year taxpayer) had the following transactions: Taxable income $4,000,000
Mining exploration costs claimed 1,000,000
Percentage depletion claimed (the property had a zero adjusted basis) 2,400,000
Donation of stock held since 1988 as investment (basis of $100,000
And fair market value of $400,000) to a qualified charity 400,000
Costs of goods sold 960,000
For 2014, May Corporation's AMTI is:

• A) $6,300,000.
• B) $7,150,000.
• C) $7,250,000.
• D) $7,300,000.
• E) None of the above.

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Definitions:

Periodic Cash Payments

Payments made regularly over a period of time, such as dividends or loan repayments.

Lease Rental Expense

An expense incurred from leasing an asset, which is typically recorded on a lessee's income statement.

Lease Liability

An obligation representing the present value of leasing payments due under a lease agreement.

Current Portion

The portion of a long-term liability that is due to be paid within the next twelve months.