Vincent and Maria,whose Modified AGI Is $164,000,adopted a Little Girl

question 31

Multiple Choice

Vincent and Maria,whose modified AGI is $164,000,adopted a little girl from Mexico which was finalized in 2016.They incurred a total of $16,000 in qualified adoption expenses.What is the amount of adoption credit they can claim in 2016?

• A)$16,400.
• B)$16,000.
• C)$0.
• D)$13,460.

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Definitions:

Perpetual Inventory Method

A system of inventory management where updates are made continuously to account for additions to and subtractions from inventory, showing real-time inventory levels.

Partial Equity Method

An accounting method used when an investing entity holds a significant but not controlling interest in another entity, recording the investment at cost and recognizing a proportionate share of the investee's earnings.

Consolidated Entity

A group of companies that includes a parent and its subsidiaries, for which financial performance is presented in a single set of financial statements.

Book Value

The net value of a company's assets as recorded on the balance sheet, excluding intangible assets like goodwill.