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52,000 X positive As a result, in 2021 a $ 2,000 X positive X AMT adjustment is required for mine exploration expenditures and a X AMT adjustment for the sale of the land.

52,000 X positive As a result, in 2021 a $ 2,000 X positive X AMT adjustment is required for mine exploration expenditures and a X AMT adjustment for the sale of the land.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Problem 12-30 (Algorithmic) (LO. 3) Archie runs a small mineral exploration business (as a sole proprietorship). In 2019, he purchased land (for $76,000) where he suspected a magnesium deposit was located. He incurred $26,000 of exploration costs related to the development of the magnesium mine in 2019 and an additional $26,000 of exploration costs in 2020. Archie elected to deduct these expenditures for regular tax purposes in both 2019 and 2020. In 2021, given a decline in magnesium prices, Archie chose to sell the property for $74,000, rather than bring the mine to production. What AMT adjustments are required in 2021 related to mine exploration expenditures and the sale of the land? 52,000 X positive X AMT adjustment is required for mine exploration expenditures and a X AMT adjustment for the sale of the land. As a result, in 2021 a $ 2,000 X positive
Transcribed Image Text:Problem 12-30 (Algorithmic) (LO. 3) Archie runs a small mineral exploration business (as a sole proprietorship). In 2019, he purchased land (for $76,000) where he suspected a magnesium deposit was located. He incurred $26,000 of exploration costs related to the development of the magnesium mine in 2019 and an additional $26,000 of exploration costs in 2020. Archie elected to deduct these expenditures for regular tax purposes in both 2019 and 2020. In 2021, given a decline in magnesium prices, Archie chose to sell the property for $74,000, rather than bring the mine to production. What AMT adjustments are required in 2021 related to mine exploration expenditures and the sale of the land? 52,000 X positive X AMT adjustment is required for mine exploration expenditures and a X AMT adjustment for the sale of the land. As a result, in 2021 a $ 2,000 X positive
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