Calculate falcon adjusted basis for regular income tax

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Reference no: EM132477017

Point 1: Falcon, Inc., owns a silver mine that it purchased several years ago for $925,000. The adjusted basis at the beginning of the year is $400,000. For the year, Falcon deducts depletion of $700,000 (greater of cost depletion of $290,000 or percentage depletion of $700,000) for regular income tax purposes.

Question a. Calculate Falcon's AMT preference.

Question b. Calculate Falcon's adjusted basis for regular income tax purposes.

Question c. Calculate Falcon's adjusted basis for AMT purposes.

Reference no: EM132477017

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