Maria, Who Is Single, Reports the Following Items for 2019

question 90

Essay

Maria, who is single, reports the following items for 2019:
Salary $80,000
Loss on sale of § 1244 small business stock acquired three years ago (60,000) $\begin{array}{lr}\text { Stock acquired two years ago became worthless during the year } & (5,000) \\\text { Long-term capital gain } & 25,000 \\\text { Nonbusiness bad debt } & (15,000) \\\text { Federal disaster area casualty loss on property held six months } & (6,000) \\\text { Federal disaster area casualty gain on property held four years } & 4,000\end{array}$ Determine Maria's adjusted gross income for 2019.

---

Definitions:

Overstated

When figures or amounts are reported higher than they actually are, potentially misrepresenting the financial condition of a business.

Inventory Accounting Methods

Different approaches to valuing and managing inventory, including FIFO (First In, First Out), LIFO (Last In, First Out), and weighted average cost.

FIFO Reserve

The difference between the cost of inventory calculated using the First In, First Out (FIFO) method and another inventory costing method.

LIFO Reserve

The difference between the cost of inventory calculated under the Last In, First Out (LIFO) method and its cost calculated under the First In, First Out (FIFO) method.