Pract exam3 part12 2011

# Pract exam3 part12 - CHAPTER 12 ALTERNATIVE MINIMUM TAX MULTIPLE CHOICE 1 Which of the following statements is correct a The purpose of the AMT is

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CHAPTER 12 ALTERNATIVE MINIMUM TAX MULTIPLE CHOICE 1. Which of the following statements is correct? a. The purpose of the AMT is to replace the regular income tax. b. Adjustments can either increase AMTI or decrease AMTI. c. Tax preferences can either increase AMTI or decrease AMTI. d. Tax preferences can only decrease AMTI. e. None of the above is correct. ANS: B Choice a. is incorrect because the purpose of the AMT is to back up the regular income tax. Choices c. and d. are incorrect because tax preferences can only increase AMTI. PTS: 1 DIF: 1 REF: p. 12-3 | p. 12-4 OBJ: 1 | 2 NAT: AICPA FN-Measurement | AACSB Analytic MSC: 5 min 7. For regular income tax purposes, Yolanda, who is single, is in the 35% tax bracket. Her AMT base is \$220,000. Her tentative AMT is: a. \$57,200. b. \$58,100. c. \$61,600. d. \$77,000. e. None of the above. ANS: B The AMT rate for the first \$175,000 of the AMT base is 26% and is 28% for the AMT base in excess of \$175,000. Yolanda’s tentative AMT is calculated as follows: \$175,000 × 26% = \$45,500 \$45,000 × 28% = 12,600 \$58,100 12-1

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12-2 2011 Annual Edition/Test Bank PTS: 1 DIF: 1 REF: p. 12-7 | Figure 12.2 OBJ: 2 NAT: AICPA FN-Measurement | AACSB Analytic MSC: 5 min 11. Which of the following normally produces positive AMT adjustments? a. Real property taxes deduction. b. Standard deduction. c. Personal exemption deduction. d.
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## This note was uploaded on 02/27/2012 for the course ECON 4371 taught by Professor Muir during the Spring '12 term at King Mongkut's Institute of Technology Ladkrabang.

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Pract exam3 part12 - CHAPTER 12 ALTERNATIVE MINIMUM TAX MULTIPLE CHOICE 1 Which of the following statements is correct a The purpose of the AMT is

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