Please answer all parts #21-26, type your response and provide an explanation

21) Which of the following statements is correct?

a. The purpose of the AMT is to replace the regular income tax.

b. Adjustments can either increase AMTI or decrease AMTL

c. Tax preferences can either increase AMTI or decrease AMTI.

d. Tax preferences can only decrease AMTI.

e. None of the above is correct.

22) Which of the following is allowed when computing AMTI for individuals?

a. Standard deduction

b. Real estate taxes

c. Charitable contributions

d. None of these

23) Which is no! an advantage of a qualified pension or profit sharing plan?

a. Employer contributions are not subject to FICA and FUTA taxes.

b. Contributions are deductible by the employer when distributed to the participants.

c. Employees are not taxed until the funds are distributed to them .

d. Income earned by the plan trust grows at a tax-free rate.

e. All of the above are advantages.

24) Which is no! considered to he a type of deferred compensation?

a. 40l (k) plan.

b. Incentive stock option (ISO) plan,

c. Tax-deferred annuities.

d. Company-supplied automobile.

e. All of the above are types of deferred compensation .

25) Which of the following assets held by a retail business is a 123 i asset?

a. Inventory.

b. A machine used in the business and held less than one year.

c. A factory building used in the business and held more than one year.

d. Accounts receivable.

e. All of the above.

26) Both short-term and long-term holding periods, respectively, axe:

22) Which of the following is allowed when computing AMTI for individuals? a. Standard deduction b. Real estate taxes c. Charitable contributions d None of these 23) Which is not an advantage of a qualified pension or profit sharing plan? Employer contributions are not subject to FICA and FUTA taxes. Contributions are deductible by the employer when distributed to the participants Employees are not taxed until the funds are distributed to them Income earned by the plan trust grows at a tax-free rate. All of the above are advantages. a. b. c. d. e. 24) Which is not considered to be a type of deferred compensation? a. S401(k) plan b. Incentive stock option (ISO) plan c. Tax-deferred annuities. d. Company-supplied automobile e. All of the above are types of deferred compensation 25) Which of the following assets held by a retail business is a S 1231 asset? Inventory b. A machine used in the business and held less than one year c. A factory building used in the business and held more than one year d. Accounts receivable e. All of the above 26) Both short-term and long-term holding periods, respectively, are a. Eighteen months or less and more than eighteen months b. Twenty-four months or less and more than twenty-four months c. Six months or less and more than six months d. Twelve months or less and more than twelve months e. None of the above