Question

Joanna received $60,000 compensation from her employer, the value of her stock in ABC company appreciated by $5,000 during the year (but she did not sell any of the stock), and she received $30,000 of life insurance proceeds from the death of her husband. What is the amount of Joanna's gross income from these items?

Answer 1

The amount of Joanna's gross income from these items is $60,000.

Step-by-step explanation:

Gross income = $60,000

Only the compensation from her employee should be considered here. Since the stock is not sold, its appreciation has no value.

A life insurance proceeds is a tax-free item, therefore not to be included in gross income.

Therefore, The amount of Joanna's gross income from these items is $60,000.