The Shepherd Corporation has $40,000 of taxable income,$200,000 of positive adjustments,and a $10,000 preference item.What is its alternative minimum taxable income?

Question

Quizplus · Accepted Answer

Alternative minimum taxable income is calculated by starting with taxable income, adding back certain deductions and adjusting for some preference items.

AMTI = Taxable Income + Positive Adjustments + Preference Items

Therefore, in this case, 
AMTI = $40,000 + $200,000 + $10,000 
= $250,000

Hence, the answer is (D) $225,000.

The Shepherd Corporation Has $40,000 of Taxable Income,$200,000 of Positive