Based upon the following facts of Fred Inc calculate adjusted
Based upon the following facts of Fred, Inc., calculate adjusted current earnings (ACE):
Alternative minimum taxable income (AMTI) ....... $7,220,000
Municipal bond interest ................ 630,000
Expenses related to municipal bonds ........... 61,000
Key employee life insurance proceeds in excess of cash
surrender value .................... 2,000,000
Increase in LIFO recapture amount ............. 170,000
Organization expense amortization ............. 200,000
Cost of goods sold .................. 4,922,000
Advertising expenses ................. 631,000
Loss between related parties ............... 230,000
Life insurance premiums paid on key person policy ..... 310,000
Administrative expenses ................ 521,014
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