Any accountant in here? help me with this HW question?

[Kroze]

____ 4. Vicki owns and operates a news agency (as a sole proprietorship). During 2000, she incurred expenses of $24,000 to increase circulation of newspapers and magazines that her agency distributes. For regular income tax purposes, she elected to expense the $24,000 in 2000. In addition, Vicki incurred $15,000 in circulation expenditures in 2001 and again elected expense treatment. What AMT adjustments will be required in 2000 and 2001 as a result of the circulation expenditures?


a.$16,000 positive in 2000, $2,000 positive in 2001.
b.$16,000 negative in 2000, $2,000 positive in 2001.
c.$16,000 negative in 2000, $10,000 positive in 2001.
d.$16,000 positive in 2000, $10,000 positive in 2001.
e.None of the above.

 

[CPA]

Got to page 4. Look at 14a.

 

[bigpimpatl]

the answer is A...I think. I believe this is the way you do it.

expense for regular inc tax purposes
- expense for for AMT purposes
= AMT adjustment

circulations are amortized for 3 years

24000
-8000
= 16000 positive year 1

15000
-13000
=2000 positive year 2

damnit, why am I doing your homework...

 

[SphinxnihpS]

____ 4. Vicki owns and operates a news agency (as a sole proprietorship). During 2000, she incurred expenses of $24,000 to increase circulation of newspapers and magazines that her agency distributes. For regular income tax purposes, she elected to expense the $24,000 in 2000. In addition, Vicki incurred $15,000 in circulation expenditures in 2001 and again elected expense treatment. What AMT adjustments will be required in 2000 and 2001 as a result of the circulation expenditures?


a.$16,000 positive in 2000, $2,000 positive in 2001.
b.$16,000 negative in 2000, $2,000 positive in 2001.
c.$16,000 negative in 2000, $10,000 positive in 2001.
d.$16,000 positive in 2000, $10,000 positive in 2001.
e.None of the above.

$400/hour