During the current year, ELS Corporation reported the following tax-related information: $5,000 tax exempt interest from

Question:

During the current year, ELS reported the following tax-related information:
• $5,000 tax exempt interest from public activity bonds issued in 2008.
• $45,000 gain included in taxable income under the installment method. The installment sale occurred two years ago.
a. What is ELS Corp.'s current year ACE adjustment assuming its cumulative ACE adjustment as of the beginning of the year is a positive $12,000?
b. What is ELS Corp.'s current year ACE adjustment assuming its cumulative ACE adjustment as of the beginning of the year is a positive $80,000?
Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...