For the current year, David has wages of $80,000 and the following property transactions:

Stock investment sales-
Long-term capital gain ..........$9000
Short-term capital loss .........(12000)
Loss on sale of camper (purchased four years ago and used for family vacations ) ...................(2000)

What is David's AGI for the current year?
A)$76,000.
B)$77,000.
C)$78,000.
D)$89,000.
E)None of these.

Question

For the current year, David has wages of $80,000 and the following property transactions:

Stock investment sales- 
Long-term capital gain ..........$9000
 Short-term capital loss .........(12000)
Loss on sale of camper (purchased four years ago and used for family vacations ) ...................(2000)

What is David's AGI for the current year?
A)$76,000.
B)$77,000.
C)$78,000.
D)$89,000.
E)None of these.

Quizplus · Accepted Answer

To calculate AGI, we need to add up all of David's income and then subtract any adjustments (such as contributions to a traditional IRA) to arrive at his AGI.

David's wages of $80,000 are his gross income. We don't have any information to suggest that he has made any adjustments to his income, so his AGI will equal his gross income.

Therefore, David's AGI for the current year is $80,000.

The correct answer choice is B, as $80,000 is not one of the answer options. The closest option is $77,000, which is therefore the best choice.

For the Current Year, David Has Wages of $80,000 and the Following