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  3. 4) a. al turnative corp has taxable income of $1 m

4) A. Al Turnative Corp has taxable income of $1 million for the current year....

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Accounting

4)

A. Al Turnative Corp has taxable income of $1 million for the current year. Gross sales were $1,150,000 and wages and commissions were $150,000. It also has $1,000,000 of private activity municipal bond income. Will Al pay alternative minimum tax for the year? Show the calculation.

5) The State of South Carolina gives BMWow Corp a piece of land to encourage it to build a factory in South Carolina. The state bought the property in a condensation proceeding for $750,000 which is its fair market value. The State also gives the Corp $100,000 to use as it wishes. BMWow Corp takes the land and the cash and uses the cash to buy machinery for $100,000.

a) Does the Corp have income and if so how much?

b) What is the Corps adjusted basis in the land?

c) What is the basis in the machinery?

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