Question

George Washburn had earnings from his salary of $32,000, interest on savings of $200, a contribution to a traditional individual retirement account of $1,200, and dividends from mutual funds of $125. George's adjusted gross income would be

Answer 1

Answer:

AGI= $31,125

Explanation:

Adjusted gross income (AGI) is the gross income plus inflows minus specific deductions.

Adjusted gross income is usually lower than gross income because of the deductions made from gross income to get AGI.

AGI= Income from salary + Interest on savings - Contributions + Dividend from mutual fund

AGI= 32,000+ 200- 1,200 + 125

AGI= $31,125