Accounting Question West LA College Accounting 015 Spring 2021 Midterm Exam Question 9

9.  Carolyn, who earns $400,000, is required to pay John, her ex-husband, $200,000 as part of the property settlement as a result of their divorce agreement which was executed in 2019. In turn, John transfers stock worth $50,000 to Carolyn. What is the amount of Carolyn’s adjusted gross income in 2019?

a.  $450,000

b. $400,000

c. $250,000

d. $200,000