I think annual income is all total income your parents earn in a year. Adjusted gross income is how much income is left after state and federal income taxes.
UCs probably ask for your parents' income so they can get a rough estimate of how much aid they're going to need to give when they make acceptance decisions. The income alone will definitely not determine whether or not you get in.
Not so sahimi. Some UC's give extra points to a very low income applicant. UCSD is one, I think UCD is another. Both use formulas wherein very low income gets bonus points. (and no, I'm not joking... even in American, socialists abound).
Gross annual income is total income of your parents for the calendar year (they would have 2009 now). Adjusted gross income is gross income minus amounts deducted for exemptions (depends on number of dependents) and minus any deductions such as for mortgage interest, contributions to pension plans, others. If you have access to your parents tax return you will find a line on the first page that shows gross income and another that shows adjusted gross income. In other words, discuss this with your parents.
UCs cannot use race or ethnic origin in the evaluation for admission but they can use fact that one is low income living in low income area and thus they request the income on the app. It is also used generally for UCs overall informational statistics such as showing how many applicants come from different income levels. Financial aid is not determined by what you put in the application for admission but instead determined solely by what is in the FAFSA and thus you do not need to make any correction to the application.
